* Four brokerage firms cut ratings, price targets
* Law firm to probe company after share price decline
* Shares fall more than 20 pct on the TSX (Adds details on downgrades, investigation; updates share price move)
By Euan Rocha
TORONTO, July 20 (Reuters) - Shares of Canadian junior Lake Shore Gold LSG.TO fell more than 20 percent on Wednesday, after a flurry of ratings downgrades a day after the miner cut its 2011 production forecast.
Toronto-based Lake Shore Gold also pushed back the timing of its Bell Creek Mill expansion by about a year. It now expects to produce between 80,000 and 100,000 ounces of gold in 2011, down from a prior forecast of 125,000 ounces, due to a change in its mine plan. [ID:nL3E7IJ1S5]
The cut prompted analysts at RBC Capital Markets, Haywood Securities, CIBC World Markets and Raymond James to cut their ratings on Lake Shore stock and lower share price targets.
Raymond James analyst Bart Jaworski said the changed mine plan causes uncertainty, and lower average life-of-mine ore grades at Lake Shore's Timmins mine are also a concern.
"Until management starts meeting its guidance and larger questions as to company-wide resource, reserve quality are reconfirmed, Lake Shore's stock is likely to continue to trade at much reduced price to net asset value multiples," he wrote in a note to clients.
Shares of Lake Shore touched a two-year low on Wednesday and were down 61 Canadian cents at C$2.25 by mid afternoon. That follows a 16 percent slide on Tuesday.
The slumping share price has also prompted Sutts Strosberg LLP, a firm that specializes in class action lawsuits, to take a look at the company.
The firm said it "investigating the circumstances surrounding Lake Shore Gold Corp's announcement that there has been a change in the mining sequence at its Timmins mine."
Haywood Securities and RBC downgraded their ratings on the junior miner's stock to "sector perform" from "outperform."
"While the company has done a great job on the exploration front the operational ramp-up has been less stellar, with several downward production revisions over the last 18 months," wrote Haywood analyst Kerry Smith in a research note.
"This current production revision for 2011, along with a further delay in commissioning of the mill expansion at Bell Creek, has put Lake Shore in the penalty box until they can start beating expectations on the production front."
Lake Shore, which aims to become a mid-tier gold miner, owns a number of properties in northern Ontario and Quebec as well as a large land position in Mexico.
CIBC, which cut its rating on Lake Shore Gold to "sector underperformer" from "sector performer," said reserves at the Timmins mine would likely need to be restated using a lower grade.
"We believe that Lake Shore has become a 'show me' stock with a 2013 target for delivery," wrote CIBC analyst Barry Cooper in a note to clients.
The brokerage firm cut its price target to C$3 from C$4.50, while RBC cut to its target to C$3.75 from C$5.25. (Additional reporting by Sharanya Hrishikesh; editing by Janet Guttsman)