Schaeffer's Trading Floor Blog

Analyst Upgrades: Caterpillar Inc., Deere & Company, and MGM Resorts International

Analysts upwardly revised their ratings on CAT, DE, and MGM

by 2/20/2014 9:21 AM
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Analysts are weighing in today on machinery concerns Caterpillar Inc. (NYSE:CAT) and Deere & Company (NYSE:DE), as well as casino operator MGM Resorts International (NYSE:MGM). Here's a quick roundup of today's bullish brokerage notes.

  • Deutsche Bank initiated a "buy" rating on CAT, after the stock bounced to a fresh one-year peak of $97.67 yesterday. Elsewhere, however, analysts have been skeptical about the stock's recent technical success. In fact, 12 of the 18 covering analysts maintain tepid "hold" ratings on Caterpillar Inc. Plus, the average 12-month price target of $97.95 is just a stone's throw away from the shares' current perch at $96.21.

  • Deutsche Bank also began coverage on DE this morning with a "buy" rating, though the stock has shed 7.7% so far in 2014 to trade at $84.29. Despite its year-to-date dip, Deere & Company has seen bullishly skewed activity in its options pits recently. The stock's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 1.70 ranks higher than 82% of comparable readings from the past year, indicating speculators have bought to open calls over puts at an accelerated rate during the past 10 weeks.

  • MGM's positive earnings report Wednesday morning led a group of brokerage firms to upwardly revise their positions on the stock late yesterday, as well as this morning. This includes J.P. Morgan Securities and Credit Suisse, which upped their respective price targets to $31 from $29 and to $30 from $26. MGM Resorts International -- trading at $25.75 -- has more than doubled in value over the past 12 months, yet short interest shot up 19.6% over the last two reporting periods and now accounts for 8.2% of the equity's available float. This is equivalent to 28.2 million shares sold short.

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