Stein Mart Declines on Analyst Downgrade

The stock lost 82 cents, or 12.2 percent, to $5.89 in midday trading.

SunTrust Robinson Humphrey analyst Robin Murchison downgraded the stock to "Neutral" from "Buy" and said promotions have been high across the industry at companies like Wal-Mart Stores Inc.

"The environment is as intense as we've ever experienced, making it difficult for the value retailers," Murchison wrote in a client note.

The analyst also said its focus on the Southeast may also hinder the company, as many other retailers have identified that region as "the most difficult."

While Stein Mart's merchandise looks solid and trendy, Murchison said, its lower prices prohibit the company from offering the consumer with lots of coupons and promotions.

Murchison lowered her fourth-quarter earnings per share estimate to 20 cents from 29 cents. Analysts polled by Thomson Financial expect 29 cents per share.