ReachLocal shares lost more than a quarter of their value Wednesday after the company reported a wider loss and an analyst cut his rating of the stock to “hold” from “buy.”
George Sutton at Craig Hallum cited weakness in ReachLocal’s U.S. business. He decreased his target price to $12 from $24 per share.
ReachLocal, a Woodlands Hills-based company that helps small businesses market online, announced a third-quarter loss on Tuesday of $4.6 million, or 16 cents a share. Last year, its third-quarter loss was $2.9 million or 10 cents per share.
In the announcement, the company cited problems with Bizzy, a customer review and ecommerce website, which lost $3.3 million in the most recent quarter. The company has shut down the site as a money-making venture, although a skeleton site remains at Bizzy.com.
Shares of ReachLocal closed Wednesday at $7.44, a loss of $2.93 or 28 percent for the day.