MIK - Why Michaels Companies Stock Fell 10% on Friday Morning
Shares of Michaels Companies (NASDAQ: MIK) fell as much as 10% on Friday morning, hamstrung by a negative analyst report. By 10:20 a.m. EST, the arts and crafts retailer's stock had recovered slightly to an 8.4% drop.
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Morgan Stanley downgraded Michaels to underweight in a report sent to investing clients, lowering the one-year price target from $7 to $5 per share. Analyst Simeon Gutman cited declining same-store sales, increasing competition from online stores, and the recent buyout of bankrupt rival chain A.C. Moore, which will add significant costs for converting roughly 40 A.C. Moore locations to Michaels stores over the next few quarters.