Piper Jaffray analyst Peter Keith lowered his price target for Michaels to $9 from $11 and reiterates an Underweight rating on the shares. The analyst continues to see flattish comps and declining EBIT margin looking out the next couple years. The company has now seen declining EBIT margin for three years, and the Keith expects this trend to continue. He notes the new CEO sets "reasonable/beatable" guidance, uses excess free cash flow to delever the balance sheet rather than repurchase stock, work toward reducing e-commerce shipping costs.

Michaels announced lower prices on over 5,000 items across categories spanning arts, crafts, DIY and home decor, offering customers everyday savings on the products they shop the most. With these latest markdowns, Michaels is helping customers fuel the joy of creativity while maximizing value. Lower prices are now in effect across categories including home decor, art supplies, seasonal items, kids' projects, wall frames, and more. To keep creativity accessible for as many customers as possible, the prices of frequently bought items like paint, markers and pens have been reduced by up to 15%; adhesive and permanent vinyl, papers, stickers, and unfinished wood letters have been reduced by up to 20%; canvases have been reduced by up to 35%, and T-shirts have been reduced by up to 40%.