Telsey downgraded the stock after the company's earnings report and concerns about tariffs.

"We are downgrading MIK to Market Perform from Outperform, as we now see several risks as overhangs on earnings and valuation over the next several quarters. First, we believe the company's 2019 comp guidance could prove optimistic in light of worse than expected 1H19 performance, despite an expected improvement in merchandising, pricing, and seasonal events to drive traffic. We are modeling a comp of (0.2%) vs. the guidance of 0%-1%. Second, the gross margin impact from the recent 25% tariff on List 3 (12% of COGS) is likely to carry over into 2020 as Michaels' inventory turns 2x a year. Third, if tariffs on List 4 are implemented, Michaels has meaningful incremental exposure with the majority of its private label product (60% of sales) imported from China. As a result, we believe it is prudent to take a more cautious approach to earnings and the stock's valuation."