Schaeffer's Trading Floor Blog

Analyst Downgrades: Duke Energy Corp (DUK), Dean Foods Company (DF), and Williams-Sonoma, Inc. (WSM)

Analysts downwardly revised their ratings on DUK, DF, and WSM

by 9/3/2013 9:41 AM
Stocks quoted in this article:

Analysts are weighing in today on energy producer Duke Energy Corp (NYSE: DUK), food and beverage concern Dean Foods Company (NYSE:DF), and home products retailer Williams-Sonoma, Inc. (NYSE:WSM). Here's a quick roundup of today's bearish brokerage notes.

  • DUK has hit a rough patch on the charts as of late, dropping 8.6% in the past month alone to its current price of $65.60. The stock now stands just 2.8% higher year-to-date. Such technical troubles have led Macquarie to slash its price target for DUK -- along with others in the energy sector -- to $74 from $75 this morning. In the options pits, DUK traders are skeptical, as well. In fact, the stock's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 1.03 ranks higher than 82% of all other such readings taken over the last year, indicating Duke Energy Corp traders have bought to open puts over calls at an accelerated rate during the past two weeks.

  • DF saw its rating lowered to "neutral" from "buy" at Goldman Sachs ahead of today's session. On the charts, the stock has been plagued with technical woes throughout the last year, and now sits nearly 42% lower on a year-over-year basis. Furthermore, DF hit a new annual low of $18.59 last week, before inching slightly higher to its current perch at $19.16. With that being said, short interest grew 31.8% during the past reporting period, and now accounts for 4.7% of DF's available float. Still, eight out of 10 analysts maintain "buy" or better ratings on Dean Foods Company, leaving the stock vulnerable to additional downgrades.

  • Finally, Canaccord Genuity downgraded its rating for WSM to "hold" from "buy" in pre-market action. Following last week's upbeat earnings report, WSM jumped to a new record high of $61.56, but ultimately ended the week in the red.Stepping back, the stock has tacked on 37.5% year-over-year, and was last seen trading at $56.41. In the options pits, activity is bearishly skewed toward WSM. Specifically, the stock sports a Schaeffer's put/call open interest ratio (SOIR) of 1.95, with puts nearly doubling calls among options expiring in three months or less. This ratio ranks just 6 percentage points from an annual acme, conveying Williams-Sonoma, Inc.'s short-term traders have rarely been more put-heavy throughout the past year.

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