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The Street was clearly not impressed with last night’s Q2 report from NetSuite (NYSE:N) (see earnings call transcript). Hit with a pair of downgrades this morning, the stock today is taking it on the chin.

Credit Suisse analyst Philip Winslow cut his rating on the stock to Neutral from Outperform, chopping his price target to $19 from $25. “Although EPS exceeded our forecast,” he writes, “cash flow and current deferred revenue results again missed our expectations, and management’s outlook for the September quarter fell below our previous revenue and EPS estimates.” Winslow still sees “a sizable long-term market opportunity” for the company, but he says the stock will be limited by weak cash flow and a longer time line toward operating profitability.

Likewise, ThinkPanmure’s Michael Huang cut his rating on the stock to Accumulate from Buy, trimming his price target to $18 from $21. “While we’re definite fans of the differentiated service offering and large opportunity, we’re also cognizant that premium valuations could be tougher to justify without clearer evidence of accelerating trends,” he writes. “The relatively in-line Q2 and guidance are not enough to entice, and although overall activity levels appear to be ramping, we’re also concerned that sales cycles are lengthening, likely attributable to larger deals and a tougher selling environment.”

Meanwhile, analysts who already disliked the stock today like it even less.

Citigroup’s Brent Thill
, who already had a Sell rating on the shares, today cut his price target to $16 from $18, noting that cash flow from operations was a negative $1.8 million in the quarter and is expected to stay negative in the second half.

And Piper Jaffray’s Mark Murphy, who also has a Sell rating on the stock, trimmed his target to $13 from $14, citing disappointing operating cash flow. “We continue to believe that the pace of new customer activity has slowed for NetSuite due to softer macroeconomic conditions,” he writes.

NetSuite closed today is down $1.15, or 6.93%, to $15.45; the stock is at the lowest level since it came public at $26 a share in December.

Source: NetSuite Takes It on the Chin