Schaeffer's Trading Floor Blog

Analyst Downgrades: Citigroup Inc, The Boeing Company, and King Digital Entertainment PLC

Analysts downwardly revised their ratings on C, BA, and KING

by 3/27/2014 9:42 AM
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Analysts are weighing in today on prominent financial firm Citigroup Inc (NYSE:C), aerospace company The Boeing Company (NYSE:BA), and Big Board newbie King Digital Entertainment PLC (NYSE:KING). Here's a quick roundup of today's bearish brokerage notes.

  • After C's plans to increase dividends and buy back stock were declined by the Federal Reserve, KBW downgraded the equity to "market perform" from "outperform," and decreased its price target to $52 from $58. Following suit, UBS cut its price target to $60 from $63, and Bernstein lowered its rating to "market perform" from "outperform." Considering Citigroup Inc is down 21% from its Jan. 9 intraday high of $55.28 to trade at $47.65, there is still plenty of room for more downgrades and/or price-target cuts in the near term, which could create additional pressure for the shares. To be specific, 15 of the 20 covering analysts maintain "buy" or better endorsements on the stock, and the average 12-month price target of $59.97 denotes significant expected upside from the shares' current perch.

  • RBC slashed BA's price target to $138 from $146 this morning amid the stock's ongoing struggles involving the missing Malaysian Airlines flight. The Boeing Company has been dealing with trouble on the charts, as well, and is currently down 10.5% on a year-to-date basis to trade at $121.94. As such, during the past 10 trading days, speculators at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have bought to open puts, relative to calls, at a near-annual-high rate. In fact, the 10-day put/call volume ratio of 0.80 at these exchanges ranks 9 percentage points from a 12-month peak.

  • Sterne Agee is the first brokerage firm to weigh in on KING, following the shares' disappointing debut performance. This morning, the firm began coverage on the stock with a "neutral" rating, after the stock plunged 15.6% in yesterday's session to close at $19.00. As my colleague Elizabeth Harrow pointed out this morning, King Digital Entertainment PLC has earned the title "the worst IPO of the year."

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