Nov 4 (Reuters) - Lazard Capital Markets downgraded eight retailers to "hold" from "buy", including apparel retailers American Eagle Outfitters Inc (AEO.N) and Guess Inc (GES.N), citing the stocks' dramatic out-performance since March.

American Eagle Outfitters

The brokerage also cut upscale department store operator Saks Inc (SKS.N) to "sell" from "hold".

The retail, apparel and footwear stocks have risen 180 percent since March while the S&P 500 index .SPX is up only 55 percent in the same period, the brokerage said, adding that the stocks are now discounting a significant earnings recovery.

"No one seems to be able to find a good short idea. This is usually a good time to take some chips off the table," analysts led by Todd Slater wrote in a note to clients.

The analysts said the sentiment in the market is shifting to "sell the news," as investors are moving to a more profit-taking mentality and are selling even into rising earnings outlooks.

The analysts kept their "buy" rating on Wal-Mart Stores Inc (WMT.N) and off-price retailer TJX Cos Inc (TJX.N).

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(Reporting by Viraj Nair and Vidya Lakshmi in Bangalore; Editing by Deepak Kannan)

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