NEW YORK (AP) — Shares of J.C. Penney Co. fell Wednesday after a Macquarie Equities Research analyst downgraded the stock, saying efforts to revive the moderately priced department store model haven't worked.

THE SPARK: Analyst Liz Dunn cut her rating for the Plano, Texas-based company to "Neutral" as part of a report reviewing department stores and other clothing retailers. She also slashed her price target for the stock by $15 to $22.

THE BIG PICTURE: J.C. Penney spent much of 2012 trying to turn around its business.

The company's sales have declined in four of the last five years. Under CEO Ron Johnson, J.C. Penney revamped its merchandise, the look of its stores and its pricing.

Nearly a year ago the company moved away from big markdowns, sales and other promotions it traditionally used to draw customers, in favor of permanently lowered prices on all items, plus monthlong sales on select items and periodic clearance events throughout the year.

But customers did not like the change and sales fell further, prompting the retailer to bring back some sales and other promotions six months later.

THE ANALYSIS: Dunn said she still thinks J.C. Penney's transformation could work, but it may take longer than originally thought.

"We believe trends will improve in 2013, but the company has dug a pretty deep hole in 2012 and sales increases are not expected to come anywhere close to the amount that has been lost," Dunn wrote in a note to investors.

THE SHARES: Down 67 cents, or 3.5 percent, to $18.32 in afternoon trading. Over the past 52 weeks the stock has traded between $15.69 and $43.18.

The restructuring and sales tumble took a heavy toll on J.C. Penney stock last year, when its shares lost about 44 percent of their value.