Internet jeweler Blue Nile is the latest casualty of a tightening consumer wallet.
“We are lowering Blue Nile shares to Hold from Buy due to the continued difficult environment for luxuryretail in the United States,” Stifel Nicolaus analyst Scott Devitt wrote Friday in a note to clients.
Stifel Nicolaus slashed its 2009 sales outlook for the company to $348 million from $375 million.
Blue Nile shares on Friday dropped $3.22, or 7 percent, to $43.06 on the report.
Founded in 1999, the Seattle,Washington, Internet jeweler went public in 2004 on the promise of shaking up the traditional jewelry businesses of Tiffany & Co. and Cartier, among others. Blue Nile was backed by Kleiner Perkins Caufield & Byers and former Microsoft co-founder Paul Allen's Vulcan Ventures.
Blue Nile sales are 90 percent diamonds, with 70 percent engagement-related transactions.