Schaeffer's Trading Floor Blog

Analyst Downgrades: Broadcom Corporation, DISH Network Corp, and United Parcel Service (UPS)

Analysts downwardly revised their ratings on BRCM, DISH, and UPS

by 7/24/2013 9:28 AM
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Analysts are weighing in today on semiconductor name Broadcom Corporation (NASDAQ:BRCM), pay-TV provider DISH Network Corp (NASDAQ:DISH), and delivery titan United Parcel Service, Inc. (NYSE:UPS). Here's a quick roundup of today's bearish brokerage notes.

  • After forecasting weaker-than-expected revenue, BRCM saw its rating and/or price target slashed at William Blair, RBC, J.P. Morgan Securities, Mizuho, Morgan Stanley, Piper Jaffray, Nomura, Credit Suisse, BMO, Brean Capital, Deutsche Bank, B. Riley, Susquehanna, Jefferies, FBR, Needham, Evercore Partners, Wedbush, Topeka, and Bernstein. With that being said, BRCM -- which closed at $31.83 -- is poised to lose more than 10% at the opening bell. Moreover, the stock has lost more than 8% during the past six months. Regardless, BRCM sports a Schaeffer's put/call open interest ratio (SOIR) of 0.39, with calls outnumbering puts by a margin of 5-to-2 among options expiring in three months or less. This ratio is sitting at its annual nadir, indicating short-term BRCM speculators are more call-heavy now than they have been at any other time throughout the year.

  • Wunderlich upped its price target for DISH to $50 from $42 ahead of today's opening bell, representing expected upside to the stock's current price of $45.38. However, the brokerage firm downgraded the equity to "hold" from "buy." Technically speaking, DISH has advanced almost 59% year-over-year, and has outperformed the broader S&P 500 Index (SPX) by nearly 11 percentage points in the past eight weeks. What's more, the stock tapped a new 13-year high of $46.89 last Thursday. Speculators at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have responded favorably to DISH's technical strength during the last two weeks, snatching up almost 12 calls for every put. The resultant 10-day call/put volume ratio of 11.80 ranks in the 89th percentile of its 52-week range, conveying calls are being picked up over puts at a near annual-high clip.

  • Deutsche Bank cut its price target for UPS to $96 from $98 this morning. (Baird, meanwhile, lifted its price target by $1 to $97.) On the charts, the stock has tacked on 18.7% since the beginning of 2013 to hover at $87.51, spurring confidence among a lot of the brokerage bunch. Specifically, UPS' 12-month price target of $93.59 represents expected upside to the stock's all-time high of $91.78, reached on July 11. Likewise, from the 20 analysts weighing in, UPS has received nine "buy" or better endorsements, 11 tepid "hold" ratings, and not a single "sell" or worse suggestion.

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