Schaeffer's Trading Floor Blog

Analyst Downgrades: Angie's List Inc, ARM Holdings plc (ADR), and Walter Energy, Inc.

Analysts downwardly revised their ratings on ANGI, ARMH, and WLT

by 4/24/2014 9:47 AM
Stocks quoted in this article:

Analysts are weighing in today on business referral site Angie's List Inc (NASDAQ:ANGI), chip maker ARM Holdings plc (ADR) (NASDAQ:ARMH), and coal producer Walter Energy, Inc. (NYSE:WLT). Here's a quick roundup of today's bearish brokerage notes.

  • Although ANGI reported a smaller quarterly earnings loss last night, the stock received a price-target cut to $18 from $21 at RBC this morning. On the charts, Angie's List Inc popped 9.2% higher to $14 out of the gate, but remains 7.7% below its year-to-date flat line. Nevertheless, the equity boasts eight "buy" or better endorsements, compared to seven "holds" and zero "sell" suggestions. Plus, the average 12-month price target among covering analysts comes in at $19.06, territory ANGI hasn't explored since early February. Should the stock resume its long-term downtrend, a round of downgrades and/or price-target cuts may be on the way, which could put more pressure on the shares.

  • ARMH -- which posted poorly received first-quarter earnings results yesterday morning -- saw its price target decreased to 900P from 918P, and to 950P from 970P, at Exane Bnp Paribas and Natixis, respectively, this morning. (Meanwhile, HSBC upped its price target by 40P.) Since the start of 2014, ARM Holdings plc (ADR) has lost about 11% to trade at $48.64, yet the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.62 ranks lower than 98% of comparable readings from the past 12 months, indicating ARMH call open interest (relative to put open interest) is almost at an annual-high level among options expiring within the next three months.

  • WLT -- which is down a whopping 54.6% year-to-date to trade at $7.56 -- received a price-target cut to $10 from $12 at RBC earlier today. Amid the stock's decline, short interest spiked 23.4% during the last two reporting periods. Now, 32.8 million shares are sold short, which is equivalent to more than half of Walter Energy, Inc.'s available float.

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