Piper Jaffray Lowers ANN Rating To Neutral; PT Unchanged At $29

Piper Jaffray is lowering its investment rating on shares of AnnTaylor Stores Corporation ANN from Overweight to Neutral on ANN shares “as we balance what we see as a still-good operating margin expansion story for the company with what we believe could be a further-delayed recovery at the LOFT division in 2011.” Longer-term, Piper Jaffray said that it believes a double-digit operating margin rate is achievable and earnings power north of $2+ is somewhere on the horizon over the next two years. “That said, this stock needs LOFT to work and we are increasingly concerned that this division is ill-prepared for Spring 2011 trends,” Piper Jaffray writes, adding that its PT of $29 remains unchanged. AnnTaylor Stores Corporation closed Friday at $27.39.