Schaeffer's Trading Floor Blog

Analyst Upgrades: Salesforce.com, Visa, and SanDisk

Analysts upwardly revised their ratings on CRM, V, and SNDK

by 10/19/2012 8:56 AM
Stocks quoted in this article:

Analysts are weighing in today on cloud computing firm Salesforce.com, inc. (NYSE:CRM - 150.10), credit card behemoth Visa Inc (NYSE:V - 141.88), and data storage provider SanDisk Corporation (NASDAQ:SNDK - 42.86). Here's a quick roundup of today's bullish brokerage notes.

  • CRM -- which boasts a year-to-date gain of about 48% -- was started at "outperform" by Wedbush ahead of the opening bell. The equity has also bested the broader S&P 500 Index (SPX) by north of 12 percentage points during the past 60 sessions, yet skeptics remain unconvinced of CRM's technical strength. Although short interest on the stock fell by 9% during the last two reporting periods, these bearish bets still account for about 10% of the security's available float. In fact, it would take more than seven days to cover these shorted shares, at the equity's average pace of trading.

  • With quarterly earnings scheduled for the end of the month, V saw its price target lifted to $162 from $142 at Jefferies this morning. The stock has advanced by more than 55% during the past year, which may be attracting call buyers. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows a 50-day call/put volume ratio of 2.25 for the equity, meaning calls bought to open have more than doubled puts during the few months. This ratio ranks in the 68th annual percentile, reflecting a healthier-than-usual appetite for calls over puts.

  • Up nearly 8% in pre-market trading, SNDK received price-target hikes to $55 from $50 at both Lazard and at Susquehanna today, after reporting better-than-expected third-quarter earnings post-close yesterday. In addition, Raymond James and Stifel Nicolaus have followed suit, upping their respective price targets to $50 and $54. Despite a year-to-date decline of about 13%, near-term traders have been showing a preference for calls over puts, as evidenced by the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.74. In other words, calls outstrip puts among options expiring in the next three months. This ratio arrives in the 12th percentile of its annual range, meaning short-term speculators have rarely been more call-heavy toward the stock during the past year.

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