Ardent Leisure Group (AAD) slid after JP Morgan downgraded its recommendation on the theme park and leisure facilities operator to "neutral" from "overweight" because of its strong share price rally and expectation it will lag the market next month.
The stock fell 4.23% to $1.75 at 1425 AEST in response, extending Wednesday's 1.1% slide after it closed the day before at its highest point in over three years at $1.85.
JP Morgan also highlighted worries that consensus forecasts are too ambitious for 2012-13 and that the bowling, theme parks and marinas segments of the business will underperform.
Furthermore, the broker found that the company traditionally performs poorly during reporting season. Ardent Leisure has produced lower returns in four out of the last six August reporting seasons despite meeting or even beating expectations.
However, the broker remains positive about the company's medium- to long-term prospects and has lifted its price target on the stock to $1.80 from $1.66 to reflect its more bullish outlook for Ardent's family entertainment centres in the US and its health clubs.
Ardent Leisure is part of the Uncapped 100.