China Nepstar (NYSE:NPD) Facing Margin, Earnings Challenges

China Nepstar (NYSE:NPD), which operates operates retail drugstores in China, was downgraded by Goldman Sachs (NYSE:GS) from "Neutral" to "Sell."

Of particular note cited by Goldman was the removal of hospital drug mark-ups of 15%, which will put the retail pharmacy industry as a disadvantage in china.

Also mentioned is the rising operational costs, also expected to put additional pressure on Nepstar's margins.

Nepstar closed Friday at $3.55, losing $0.33, or 8.51 percent.