Schaeffer's Trading Floor Blog

Analyst Downgrades: LinkedIn Corp, DIRECTV, and MasterCard Inc

Analysts downwardly revised their ratings on LNKD, DTV, and MA

by 5/2/2014 9:50 AM
Stocks quoted in this article:

Analysts are weighing in today on professional networking site LinkedIn Corp (NASDAQ:LNKD), digital entertainment provider DIRECTV (NASDAQ:DTV), and credit card issuer MasterCard Inc (NYSE:MA). Here's a quick roundup of today's bearish brokerage notes.

  • LNKD's 2014 sales guidance were a disappointment on Wall Street. Among the group of brokerage firms to downwardly adjust their positions were CRT Capital and Canaccord Genuity, which each cut their price targets to $225 from $235 and $250, respectively. On the charts, LinkedIn Corp has shed 27% year-to-date to trade at $158.34, after dropping 1.6% in early trading. Nevertheless, the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.48 ranks in the bottom 5% of its 12-month range, indicating call open interest (relative to put open interest) is nearing annual-high levels among options expiring within the next three months. Should LNKD continue on its downward trajectory, these bullish bettors may hit the exits, creating additional pressure on the shares.

  • Citigroup downgraded DTV to "neutral" from "buy," but upped its price target to $82 from $79 this morning, after the stock jumped more than 4% yesterday, on reports that AT&T Inc (NYSE:T) is looking to acquire the company. What's more, DIRECTV claimed a new record high of $82.75 yesterday, and is now situated roughly 15.8% higher on a year-to-date basis, after giving back 0.9% to $80.01 this morning. Regardless, DTV's SOIR of 1.04 ranks in the 84th percentile of its 12-month range, insinuating short-term speculators are more put-heavy than usual right now. A continuation of DTV's upward trajectory, a solid bid from T, or a strong earnings showing Tuesday morning may lead to a capitulation of bearish bettors, which could give the stock an additional boost up the charts.

  • MA -- which is down 11.4% year-to-date to trade at $74.09 -- received a handful of bearish brokerage notes in pre-market action, after the company said sanctions on Russia would create "serious complications" for its operations in the country. Among the skeptics on Wall Street were Citigroup and Sandler O'Neill, which each cut their price targets by $4 to $87 and $79, respectively. Elsewhere, MasterCard Inc sports 18 "buy" or better endorsements, compared to nine "holds" and not a single "sell" suggestion. Plus, its average 12-month price target of $89.58 towers over the shares' current perch. As such, more downgrades and/or price-target cuts may be in the cards for the underperforming stock, which could create additional headwinds.

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