Taiwanese smartphone maker HTC is the "biggest victim" of the intensifying battle in the premium handset space, said Citi, and going by history, there is little scope for the struggling company to stage a turnaround.
Following the company's grim earnings announcement on Tuesday, Citi, which has a "sell" recommendation on HTC, cut its 12-month target price on the stock to 97 New Taiwan dollars ($3.23), from 134 New Taiwan dollars, previously. The revised target marks 39 percent downside from current levels.
"The overall high-end demand slowdown forced Samsung to get more aggressive on marketing dollars, which in turn forced other vendors such as Sony and LG to follow. However, HTC, constrained by more limited resources, was not able to follow, which makes [it] the biggest victim of high-end demand weakness," Kevin Chang, analyst at Citi, wrote in a note published late Tuesday.
(Read more: Facebook can't save HTC as earnings miss: Analyst)
HTC shares traded limit-down on Wednesday, plunging almost 7 percent, on concerns over the company's profitability after it warned a day earlier that it expects to post its first operating loss in the July-September quarter. The company said its operating margin in the third quarter may shrink to between zero and negative 8 percent, from 1.5 percent in the previous quarter.