Fossil Group Inc. shares were downgraded to underperform from market perform at Wells Fargo on concerns about the company's wearables business going forward. Fossil shares are down 17.1% in Wednesday premarket trading after reporting disappointing earnings results. Among the details analysts highlight are the fourth-quarter sales miss "despite a much-hyped push into wearables (that was three years in the making)," management's need to reinvest in wearable pricing in order to drive volume, and a plan to relaunch wearables in the third quarter with lower pricing, which will drive down profitability. Analysts anticipate that pricing will be 10% lower. Fossil shares are down 31.4% for the past year while the S&P 500 index is up 25.4% for the same period.
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