Shares of Designer Brands (NYSE:DBI) were down on Friday, after two analysts lowered price targets for the stock following a dividend cut earlier this week.
As of 2 p.m. EDT, Designer Brands' shares were trading down about 7.3% from Thursday's closing price.
In notes published on Friday morning, Needham analyst Rick Patel and Deutsche Bank analyst Paul Trussell both cut their price targets for Designer Brands' shares while maintaining their ratings.
Patel, who continues to rate the stock a buy, lowered his price target to $11 from $17, saying that the company could still generate positive cash flow in the first quarter despite closing its brick-and-mortar stores. He said that the decisions to reduce its dividend and draw down a line of credit, announced earlier this week, will give the company flexibility to get through the near-term crisis.
Trussell maintained his hold rating on Designer Brands' stock while cutting his price target to $8 from $19.
The parent company of DSW Designer Shoe Warehouse and other shoe retailers has come under intense pressure as "social distancing" measures to slow the spread of the COVID-19 coronavirus outbreak have taken hold. It closed its physical stores on Tuesday, but said that it will keep its warehouses open to fulfill online orders for the time being.
Designer Brands has $115 million in cash, a solid reserve to try to ride out the coronavirus storm. If it can do so without severe measures, it should do well as the economy recovers. But investors will need to wait for a clearer picture of how that might play out.