Schaeffer's Trading Floor Blog
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A mixed bag of earnings has translated into a wishy-washy session for the major market indexes thus far. Along with the big-cap tech stocks in the news, the following equities are making headlines, attracting the attention of analysts: restaurateur Chipotle Mexican Grill, Inc. (NYSE:CMG), drug maker Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX), and commodity concern Royal Gold, Inc (USA) (NASDAQ:RGLD).

  • A stronger-than-expected earnings report has translated into a flood of upbeat analyst attention for CMG, which is up 9.7% at $360.34. Specifically, Jefferies, RBC, Lazard, Barclays, BMO, Credit Suisse, and Deutsche Bank all upped their respective price targets. There could be even more contrarian upside in store for Chipotle, as short interest accounts for 12.2% of the stock's total available float. In fact, at the equity's average daily trading volume, it would take nearly 12 sessions to buy back all of these bearish bets -- plenty of fuel for a short-covering rally.

  • VRTX is also an analyst favorite today, with the stock last seen a whopping 60.2% higher at $84.72. Earlier, the equity touched a 12-year high of $85.90, after the company unveiled encouraging trial results for its experimental cystic fibrosis drug, VX-661. As such, Vertex Pharmaceuticals has seen no fewer than seven price-target hikes, while Canaccord Genuity upgraded the stock to "buy" from "hold," and Goldman Sachs lifted its rating to "neutral" from "sell." More than a few options traders are likely celebrating today's rally; nearly four calls have been bought to open for every put during the past two weeks on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Plus, the security's 10-day call/put volume ratio of 3.73 ranks in the 85th percentile of its annual range, pointing to a healthier-than-usual appetite for bullish bets of late.

  • Finally, brokerage firm RBC ripped into the gold-mining sector, slashing its price target on RGLD to $71 from $105. The stock was last seen fractionally lower at $51.92, and is poised to close the week with a 14.1% deficit, thanks to its gold-inspired sympathy swoon. On the sentiment front, there could be more negative analyst notes on the horizon for Royal Gold, which fell to a two-year nadir of $50.20 yesterday. Currently, the consensus 12-month price target on the stock stands at $88.58, representing a premium of about 71% to RGLD's current share price.

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