Schaeffer's Trading Floor Blog

Analyst Downgrades: Lululemon Athletica inc., Hertz Global Holdings, Inc., and Quicksilver, Inc.

Analysts downwardly revised their ratings on LULU, HTZ, and ZQK

by 6/9/2014 9:30 AM
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Analysts are weighing in today on yoga apparel maker Lululemon Athletica inc. (NASDAQ:LULU), car rental service Hertz Global Holdings, Inc. (NYSE:HTZ), and casual apparel retailer Quiksilver, Inc. (NYSE:ZQK). Here's a quick roundup of today's bearish brokerage notes.

  • D. A. Davidson cut its price target on LULU to $56 from $64 in pre-market action -- just a few days short of the company's first-quarter earnings report Thursday morning. Lululemon Athletica inc. has lost almost 25% year-to-date to trade at $44.42, and has an impressive amount of short interest stacked up against it. To be more specific, 18.3% of the equity's available float is currently sold short, and at the shares' average daily volume, it would take roughly 11 sessions to cover these bearish bets.

  • HTZ was removed from Wells Fargo's priority stock list this morning, after the equity plunged 9% on Friday to close at $27.73, on news that its accounting practices have been erroneous over the past three years. Meanwhile, in the options pits, Hertz Global Holdings, Inc. sports a Schaeffer's put/call open interest ratio (SOIR) of 0.67, which ranks 9 percentage points from a 12-month peak. In other words, short-term speculators are more put-heavy than usual toward HTZ right now.

  • ZQK -- which is down 58% year-to-date to trade at $3.68 -- was slapped with a price-target cut to $4 at Roth Capital this morning. Nevertheless, the stock boasts a SOIR of 0.38, which ranks in the bottom 5% of all readings from the past 12 months. This means call open interest on Quicksilver, Inc. (compared to put open interest) is at a near-annual-high level.

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