Burberry Group (OTC:BURBY) Plc Sponsored Adr (BURBY) shares were cut to Hold from Buy at Stifel on Wednesday, with analysts lowering the firm's price target for the London-listed stock to 1,550p from 1,950p per share.
Analysts said in a note to clients that luxury fashion business Burberry is a show-me story that requires further investor patience.
Stifel believes the improvement in Burberry's turnaround and elevation journey is being held back by an adverse external environment in 2024.
"It is still early days in Daniel Lee's era and worsening sector trends since last September will likely make it tougher for Burberry to decouple from the sector trends and deliver the proof points that investors have been waiting for," analysts wrote.
Overall, Stifel views Burberry as a cheap stock that lacks catalysts for rerating and "requires further investor patience as the earnings downgrade cycle does not appear over yet."
Burberry's stock is down more than 3% Wednesday, heading into the close in London.