Stamps.com, the L.A.-based do-it-yourself stamp company, is hoping it won’t take a licking from investors when it issues its second quarter earnings report Wednesday.

There’s not much more room to fall. The formerly high-flying stock had been as high as $39.24 three months ago, but has since tumbled by nearly 20 points and was trading around $19.75 last week.

As late as January, investment analyst Needham & Co. had given Stamps.com a “buy” rating. Needham has since downgraded it to a “hold,” citing the risk of competitive pressure from a new product.

The latest entry into the private online postage market is Dymo Stamps. The joint venture of online stamp rival Endicia and Newell-Rubbermaid Inc.’s label-maker Dymo could take some of the print-it-yourself postage business away from Stamps.com.

“We continue to view Stamps.com as a compelling play on the growth of Internet-enabled business services, but would stay on the sideline for now,” Needham analyst Mark May wrote in his most recent posting.

He also noted that because it wasn’t until June that the company began marketing its PhotoStamps product which enables consumers and businesses to design or insert their own photos into U.S. postage online it will likely have little effect until the third quarter.

However, the analyst saw some reasons for investors to stick with Stamps.com.

Dymo Stamps doesn’t charge a monthly subscription fee, but does require users to print stamps on Dymo printers. The startup cost of buying the least-expensive printer in the line amounts to nine months of Stamps.com subscription fees, which are $15.95 per month. The limited Dymo service also does not allow electronic delivery confirmation or insurance.

A Stamps.com executive declined comment on the recent slide in the company’s shares, saying only, “Wait until the report.”