What: Continuing last week's painful slide, shares of Fitbit Inc (NYSE:FIT) plunged another 10.7% as of 11:30 a.m. Monday after an analyst weighed in with a negative note regarding the fitness technology specialist.
So what: Specifically, R.W. Baird analyst William Power significantly reduced the company's price target on Fitbit shares to $30 from $54, citing mounting concerns over the reception of its recently launched Blaze smartwatch.
For perspective, the reduction comes less than a week after Baird reiterated its "Outperform" rating on Fitbit stock with a $54 price target. At the time, Power acknowledged investors' concern over whether the new device could compete with rival devices like the Apple Watch, as well as a lack of updates at CES 2016 for its flagship Charge and Charge HR devices.
Now what: Though Fitbit's smartwatch might be cheaper than many alternatives, fellow Fool Andrew Tonner already pointed out that it suffers not only from a lack of actual smart watch features -- aside from its core fitness competencies, it only offers push notifications and music control -- but it has no app ecosystem to speak of. Adding to those concerns are increased headwinds from new market entrants like Under Armour (NYSE:UAA), which launched its own suite of Connected Fitness products at last week's show including a fitness band, smart scale, chest band, a new fitness app, and even a smart shoe.
At the same time, you might argue the bad news is already baked in; Fitbit stock has fallen more than 35% over the past five trading days, and it now sits below its $20 IPO price for the first time.
At risk of catching a falling knife, I think investors would be wise to wait until Fitbit offers perspective on its current situation with its quarterly report early next month. If it doesn't prove the naysayers wrong then, I fear Fitbit stock could have much further to fall from here.