Schaeffer's Trading Floor Blog

Analyst Upgrades: Hewlett-Packard, Intuitive Surgical, and Home Depot

Analysts upwardly revised their ratings on HPQ, ISRG, and HD

by 2/22/2013 8:58 AM
Stocks quoted in this article:

Analysts are weighing in today on computer giant Hewlett-Packard Company (NYSE:HPQ - 17.10) , medical equipment manufacturer Intuitive Surgical, Inc. (NASDAQ:ISRG - 561.25), and home improvement retailer The Home Depot, Inc. (NYSE:HD - 64.38). Here's a quick roundup of today's bullish brokerage notes.

  • Up 20% so far this year, HPQ was flooded with upbeat attention this morning, thanks to last night's better-than-expected quarterly earnings results. UBS raised the stock to "neutral" from "sell" -- and lifted its price target to $19 from $12 -- while analysts at BMO, Credit Suisse, RBC, J.P. Morgan Securities, Jefferies, and Evercore Partners also upwardly revised their respective price targets. What's more, there could be additional upgrades on the way, as only one analyst has deemed HPQ worthy of a "strong buy" endorsement, compared to 16 "holds," and seven "sell" or worse suggestions.

  • ISRG -- which has trekked about 14.5% higher in 2013 -- was upgraded to "buy" from "neutral" at Goldman Sachs ahead of the opening bell. However, traders have been bearishly biased toward the stock lately. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows a 10-day put/call volume ratio of 1.36, indicating puts bought to open have outstripped calls during the past two weeks. In fact, this ratio is just 8 percentage points shy of a yearly peak, signaling speculators have been snapping up puts over calls at a near annual-high pace.

  • As HD prepares to report fourth-quarter earnings before the open on Feb. 26, the equity was boosted to "outperform" from "perform" at Oppenheimer today. Meanwhile, Jefferies increased its price target to $59 from $58. Technically speaking, these votes of confidence could help add to the stock's year-to-date advance of about 4%. Elsewhere, short-term calls seem to have a slight edge over puts, as evidenced by the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.97. This bullishly skewed ratio is just 3 percentage points above a 52-week nadir, meaning near-term traders have rarely been more call-heavy toward HD during the past year.

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