NEW YORK (AP) - Shares of some retailers have climbed a bit too high as investors hope for a consumer spending turnaround, an analyst said Wednesday as he lowered the ratings on several companies in the sector.

Todd Slater of Lazard Capital Markets said in a client note that the better earnings reported by some retailers have been driven by margin recovery, but that a sales recovery needs to occur to justify stock prices heading into 2010.

Slater is also worried about shoppers amid a potential economic recovery, as ``unemployment remains high, consumer confidence is falling, consumer credit costs have nowhere to go but up and prices for consumables and energy are edging higher.''

AMERICAN EAGLE OUTFITTERS NE  NYSE:AEO  Updated: 16:02 ET  15.01  +0.47

CALLAWAY GOLF CO  NYSE:ELY  Updated: 16:00 ET  7.17  -0.09

The analyst cut the ratings of American Eagle Outfitters Inc., Jones Apparel Group Inc., Callaway Golf Co., Guess Inc., Golfsmith International Holdings Inc., Warnaco Group Inc., Quicksiler Inc. and True Religion Apparel Inc. to ``Hold'' from ``Buy.'' Slater also reduced Saks Inc. to ``Sell'' from ``Hold.''

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