Schaeffer's Trading Floor Blog

Analyst Downgrades: B/E Aerospace Inc, SodaStream International Ltd, and Splunk Inc

Analysts downwardly revised their ratings on BEAV, SODA, and SPLK

by 5/15/2014 9:16 AM
Stocks quoted in this article:

Analysts are weighing in today on aircraft specialist B/E Aerospace Inc (NASDAQ:BEAV), carbonated beverage concern SodaStream International Ltd (NASDAQ:SODA), and software issue Splunk Inc (NASDAQ:SPLK). Here's a quick roundup of today's bearish brokerage notes.

  • BEAV was smacked with a downgrade to "neutral" from "buy" at UBS overnight. This skeptical re-evaluation toward a stock that's up more than 51% year-over-year bucks the withstanding trend seen among the brokerage brunch, however. Of the 14 covering analysts, all but one maintain a "buy" or better recommendation, with not a single "sell" to be found. Meanwhile, although the consensus 12-month price target of $102.05 sits at a slim 4.2% premium to B/E Aerospace Inc's current price of $97.95, it resides in territory yet to be charted by the equity.

  • After reporting disappointing first-quarter domestic sales Wednesday morning, SODA was hit with a $1 price-target cut to $47 at Citigroup today. It's been a dismal run for the stock on the charts, as well, with the shares off 18.2% this year to churn near $40.62. In spite of this, the equity has racked up a 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 2.10, which ranks in the 76th percentile of its annual range. Simply stated, calls have been bought to open over puts at an accelerated clip in recent weeks. With more than one-third of SodaStream International Ltd's float sold short, a portion of this activity could be the result of short sellers hedging against any unexpected upside.

  • SPLK has also been charting a path steadily lower in 2014 -- down more than 36% to trade at $43.70. Against this downtrend, Goldman Sachs this morning slashed its price target for Splunk Inc by $37 to $55. Option players have also taken note of this dreary price action, as evidenced by the equity's 50-day ISE/CBOE/PHLX put/call volume ratio of 0.84, which ranks in the bearishly skewed 78th percentile of its annual range. With earnings due out the evening of Thursday, May 29, the price to purchase SPLK's short-term options has been on the rise, from a volatility standpoint. Specifically, the stock's Schaeffer's Volatility Index (SVI) of 68% ranks just 3 percentage points from a 52-week peak.

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