Schaeffer's Trading Floor Blog

Analyst Update: Hewlett-Packard, Texas Instruments, AT&T, and Diamond Foods

Analysts adjusted their positions on HPQ, TXN, T, and DMND

by 11/15/2012 1:02 PM
Stocks quoted in this article:

With markets in negative territory this afternoon, here is quick update to today's latest brokerage notes, including adjustments for tech giant Hewlett-Packard Company (NYSE:HPQ - 13.03), semiconductor designer Texas Instruments Incorporated (NASDAQ:TXN - 28.76), telecom venture AT&T Inc. (NYSE:T - 33.21), and packaged nuts company Diamond Foods, Inc. (NASDAQ:DMND - 15.25).

  • Dow heavyweight HPQ is in the red at midday, after Mizuho cut its price target to $15 from $17. On a technical basis, the shares have been floundering, backpedaling 53% over the past year, and lagging the broader S&P 500 Index (SPX) by nearly 32 percentage points during the past three months. The stock could be in danger of further downside, should bullish analysts reassess their positions. The average 12-month price target of $17.74 represents a 36.5% premium to today's decade-long worst of $13.00.

  • Following a decision to eliminate roughly 5% of its workforce, TXN was met with a pair of upbeat brokerage notes. Specifically, Barclays lifted its price target to $29 from $28, while UBS raised its target by $2 to $30. As the security nears an even return for 2012, the negativity lined against TXN could begin to unwind. Out of the 34 analysts following the stock, only 10 offer up "buy" endorsements. Meanwhile, the consensus 12-month price target sits at $29.15, which is a slim premium to Wednesday's settlement of $28.76.

  • National Securities Research initiated coverage on blue chip T today with a lukewarm "neutral" rating. If this is any indication of what's ahead for the stock, its recent retreat on the charts could be prolonged. Since tagging a multi-year best of $38.58 in mid-September, the shares have plummeted some 14%, and have been struggling below their 200-day moving average for more than a week. Elsewhere on Wall Street, the short-term options crowd is much more put-heavy than usual, as evidenced by T's Schaeffer's put/call open interest ratio (SOIR) of 1.99, which registers in the 87th annual percentile.

  • DMND's accounting scandal continues to hurt the stock, as the company finally restated results for fiscal years 2010 and 2011 -- which erased $56.5 million in profit -- and revealed a net loss for the first three quarters of 2012. Though DMND offered a turnaround plan, today's long-awaited announcement knocked the shares down by roughly 22%, notching a six-year low of $14.50 in the process. To boot, Barclays dropped its price target by $13 to $12, while BMO cut its target to $13 from $18. Plenty of negativity is already stacked against the equity. Short interest currently accounts for a considerable 38.6% of DMND's float. As a result, it would take over two months to buy back all of these bearish bets.

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