Schaeffer's Trading Floor Blog

Analyst Downgrades: Apollo Group, Cisco Systems, and Intel

Analysts downwardly revised their ratings on APOL, CSCO, and INTC

by 10/17/2012 9:23 AM
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Analysts are weighing in today on private education provider Apollo Group Inc (NASDAQ:APOL - 27.49), telecom issue Cisco Systems, Inc. (NASDAQ:CSCO - 18.85), and tech giant Intel Corporation (NASDAQ:INTC - 22.35). Here's a quick roundup of today's bearish brokerage notes.

  • Down nearly 12% in pre-market action, APOL received a price-target cut to $34 from $45 at BMO this morning after the company reported weaker-than-anticipated quarterly earnings post-close yesterday, along with plans to cut 800 jobs and close 25 campuses. The equity has shed about 49% so far this year, which may be attracting put players. The security's Schaeffer's put/call open interest ratio (SOIR) sits at 2.39, meaning puts more than double calls among the front three-months' series of options. This ratio is just five percentage points shy of a bearish peak, conveying short-term traders have rarely been more put-heavy toward APOL during the past year.

  • Despite a year-over-year gain of roughly 8%, CSCO was downgraded to "hold" from "buy," and saw its price target lowered to $19.50 from $20.50 at Cantor Fitzgerald today. Even so, sentiment among the brokerage firms covering the equity remains bullishly slanted. In fact, 20 analysts have deemed CSCO worthy of a "buy" or better rating, compared to 13 middling "holds" and not a single "sell" suggestion. Meanwhile, Thomson Reuters shows an average 12-month price target of $21.85, representing a premium of 16% to Tuesday's closing price of $18.85.

  • After issuing a weak fourth-quarter guidance and third-quarter results on Tuesday evening, INTC was hammered with bearish analysts' attention ahead of the open. Specifically, Jefferies lowered its price target to $24 from $29, while Canaccord Genuity, Nomura, UBS, Piper Jaffray, Sterne Agee, Susquehanna, Stifel Nicolaus, FBR, and Bernstein also issued downward price-target adjustments. However, despite a year-to-date decline of about 8%, calls bought to open have slightly outstripped puts during the past month, as evidenced by the stock's 20-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 1.06.

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