Stitch Fix Inc. analysts cut their price targets after the company reported first-quarter results that topped expectations and gave a second-quarter outlook that was seen as disappointing.

“Investors are questioning the ability to add new customers,” Wells Fargo wrote, adding that while the first quarter demonstrated improvement on this metric, “re-deceleration is planned for 2Q, keeping those concerns at the forefront.”

The stock sank 26 per cent at 9:57 a.m. in New York, extending a pronounced decline that has erased more than 60 per cent from its value since September.

Here’s what analysts are saying:

Wells Fargo (Ike Boruchow)

“The 1Q print was a bit of a mixed bag – the quarter itself was actually pretty good, but the 2Q outlook was disappointing.”

Price target lowered to $25 from $30, but overweight rating maintained. “We liked the 1Q performance overall, but we think enough questions remain to keep this stock highly-debated throughout the year.”

RBC Capital Markets (Mark Mahaney)

Calls the results mixed, noting that revenue growth expanded and both gross and Ebitda margins expanded, while net additions declined again.

"At the margin, we are less constructive due to moderating growth in Active Clients, which also implies some limits to the broader value proposition of the service."

Cuts price target to $39 from $50, which had been the highest on the Street. Affirms outperform rating.

Goldman Sachs (Heath Terry)

Keeps neutral rating, seeing “further Ebitda margin contraction ahead” despite gross margins moving higher.

Trimmed price target by $1 to $24, writing that while the company’s second-quarter revenue outlook “bracketed consensus, management guided to ’relatively flat’ sequential active client growth despite guiding adj. Ebitda below consensus at the midpoint.”

Stifel (Scott Devitt)

“We support the company’s continued execution as it leverages data science to increase wallet share, improve client satisfaction rates, and drive cost efficiencies.” Maintains hold rating and $28 price target, however, “given the limited visibility into Stitch Fix’s core, domestic active client growth over the intermediate term.”

SunTrust Robinson Humphrey (Sal Catrini)

Affirms buy rating and US$40 price target.

“With an expanded offering, market leadership, strong brand, scale and financial discipline, we believe the bull thesis on SFIX remains intact, with mgmt executing well against an aggressive growth strategy in a nascent market.”