Schaeffer's Trading Floor Blog

Analyst Update: Research In Motion Limited (USA), Las Vegas Sands, and Wynn Resorts

Analysts adjusted their positions on RIMM, LVS, and WYNN

by 1/18/2013 11:00 AM
Stocks quoted in this article:

Stocks are flirting with breakeven this morning, as Wall Street digests a mixed bag of big-cap earnings reports. However, three stocks are trading decisively higher on the heels of upbeat analyst notes: BlackBerry maker Research In Motion Limited (USA) (NASDAQ:RIMM - 15.61), and casino concerns Las Vegas Sands Corp. (NYSE:LVS - 52.43) and Wynn Resorts, Limited (NASDAQ:WYNN - 124.87).

  • RIMM touched an 11-month high of $15.88 right out of the gate, after Jefferies Group upgraded the stock to "buy" from "hold." Furthermore, the brokerage firm lifted its price target to $19.50 from $13, citing generally low expectations ahead of RIMM's BlackBerry 10 launch on Jan. 30. The stock has more than doubled since touching a multi-year low of $6.22 in late September, and is attempting to conquer its 20-month moving average for the first time since February 2011. Nevertheless, there's still plenty of room on the bullish bandwagon. Currently, RIMM sports just one "buy" endorsement, compared to 17 "holds" and 14 "sell" or worse suggestions. A wave of additional upgrades could add contrarian fuel to the equity's fire.

  • Meanwhile, Wells Fargo offered its two cents on the casino sector, upgrading LVS to "outperform" from "market perform." The analysts waxed optimistic on gambling prospects in Macau, and said LVS could be a decent dividend play. However, while most of the brokerage bunch has already joined the bulls' camp -- the stock sports 15 "buy" or better ratings, compared to four "holds" and zero "sells" -- the options crowd is singing a different tune. On the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day put/call volume ratio of 0.89 ranks in the 92nd percentile of its annual range. Or, in simpler terms, option buyers have initiated bearish bets over bullish at a much faster-than-usual clip during the past two weeks. At last check, LVS is up 1.1%, and is set to end the month atop its own 10-month and 20-month trendlines for the first time since April.

  • For all the same reasons, Wells Fargo also upped its opinion of WYNN to "outperform" from "market perform." Similar to sector peer LVS, options traders are wary of WYNN, despite its status as a broad-market outperformer of late. The security's Schaeffer's put/call open interest ratio (SOIR) of 1.70 indicates puts comfortably outnumber calls among options expiring within three months. What's more, this ratio stands higher than 83% of all other readings of the past year, implying near-term options players are more put-skewed than usual right now. In early trading, the shares of WYNN have advanced 1.2% and, like LVS, is on pace to notch a finish atop its 10-month and 20-month moving averages for the first time since April.

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