Zacks Investment Research downgraded shares of Shutterfly Inc (SFLY) from OUTPERFORM to NEUTRAL on November 09, 2012, with a target price of $27.00.
Shutterfly is panning out initiatives like product innovation, focus on developing a successful commercial printing business, persistent strategic partnerships with retailers and opportunistic acquisitions. Management foresees several opportunities ahead, as the social expression and personal publishing markets are still in a nascent stage. Some of Shutterfly's recently clinched deals continue to strengthen the company's portfolio. Further, it remains geared up to beef up its offerings in the growing mobile e-commerce segment. However, there are threats from challenging economic conditions and a fierce discounting war among the competitors. After the ongoing fourth quarter comes to an end, Shutterfly will face three seasonally weak quarters. Moreover, most of the company's recent acquisitions are still in the early business development stage and are likely to take some time to reap full potential. Hence, we downgrade our recommendation from Outperform to Neutral.
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