Schaeffer's Trading Floor Blog

Analyst Upgrades: Green Mountain Coffee, Lululemon Athletica, and Verizon Communications

Analysts upwardly revised their ratings on GMCR, LULU, and VZ

by 12/3/2012 8:59 AM
Stocks quoted in this article:

Analysts are weighing in today on coffee giant Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR - 36.67), yoga apparel retailer Lululemon Athletica inc. (NASDAQ:LULU - 71.78), and wireless services provider Verizon Communications Inc. (NYSE:VZ - 44.12). Here's a quick roundup of today's bullish brokerage notes.

  • Up more than 2% in pre-market trading, GMCR scored a price-target hike to $56 from $42 at Lazard this morning. The security has surrendered nearly 35% during the past year, yet most of the analysts covering GMCR maintain an upbeat attitude. The stock boasts eight "strong buys" and two "buy" endorsements, compared to three "holds" and one "strong sell." What's more, Thomson Reuters shows an average 12-month price target of $43.64 for the security, representing expected upside of about 19% to Friday's closing price of $36.67.

  • LULU -- which is due to report quarterly earnings later this week -- was started with a "buy" recommendation and a price target of $91 at Canaccord Genuity today. The equity has surged nearly 54% year-to-date, yet there is still plenty of bearish speculation surrounding LULU. Short interest on the security accounts for more than 14% of its available float -- or the equivalent of about 11 days' worth of pent-up buying demand, at the stock's average pace of trading. Should the shares continue to climb higher, LULU could end up benefiting from a short-covering rally down the road.

  • VZ was upgraded to "buy" from "neutral" at Nomura ahead of the open, which could add to the stock's year-over-year gain of roughly 17%. Meanwhile, puts have the upper hand in the near-term options pits. In fact, Schaeffer's put/call open interest ratio (SOIR) for VZ checks in at 1.82, with puts nearly doubling calls among options scheduled to expire within the next three months. This ratio ranks higher than 70% of other such readings collected over the past year, meaning short-term traders are more bearishly biased toward the equity than usual.

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