Schaeffer's Trading Floor Blog

Analyst Upgrades: Baidu Inc (ADR), QUALCOMM, Inc., and Southwest Airlines Co

Analysts upwardly revised their ratings on BIDU, QCOM, and LUV

by 4/25/2014 9:20 AM
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Analysts are weighing in today on Chinese search engine Baidu Inc (ADR) (NASDAQ:BIDU), digital communications specialist QUALCOMM, Inc. (NASDAQ:QCOM) and airline operator Southwest Airlines Co (NYSE:LUV). Here's a quick roundup of today's bullish brokerage notes.

  • While BIDU is down more than 10% year-to-date to trade at $159.74, the stock is poised to erase some of those losses in today's session, thanks to the company's first-quarter earnings win and positive current-quarter guidance. In response to last night's upbeat report, Brean lifted its price target on the stock by $20 to $220, while Deutsche Bank raised its rating to "buy." (Stifel, however, cut its price target by $23.) Meanwhile, in Baidu Inc's (ADR) options pits of late, speculators have been buying to open puts, relative to calls, at a near-annual-high pace, as the equity's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.74 ranks higher than 97% of comparable readings taken during the past 12 months.

  • Although QCOM posted its smallest quarterly revenue increase since 2010 on Wednesday -- sending the shares 3.5% lower to close Thursday's session at $77.87 -- SocGen upped its price target on the stock to $78 from $76 this morning. Meanwhile, in QUALCOMM, Inc.'s short-term options pits, call open interest roughly doubles put open interest, resulting in a Schaeffer's put/call open interest ratio (SOIR) of 0.49. What's more, this reading ranks in the 28th percentile of its 12-month range, meaning short-term speculators are more call-focused than usual toward QCOM right now.

  • Finally, LUV -- which reported stronger-than-expected first-quarter earnings yesterday morning -- received a price-target hike to $28 from $26 at Cowen and Company this morning. And, there is still plenty of room for more price-target lifts on Southwest Airlines Co, which is up 28.8% year-to-date to trade at $24.27. Currently, the average 12-month price target among analysts comes in at $24.77, just a stone's throw away from LUV's current perch. Should the stock continue to make headway on and off the charts, more brokerage firms may upwardly adjust their expectations on LUV, which could give the shares an extra boost.

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