Schaeffer's Trading Floor Blog

Analyst Update: Halliburton, PetSmart, and Virgin Media

Analysts adjusted their positions on HAL, PETM, and VMED

by 11/19/2012 12:05 PM
Stocks quoted in this article:

While U.S. stocks are surging into the positive territory this afternoon, here is quick update of today's latest brokerage notes, including adjustments for oilfield services company Halliburton Company (NYSE:HAL - 31.54), all-things-animals retailer PetSmart, Inc. (NASDAQ:PETM 68.92), and entertainment and communications group Virgin Media Inc. (NASDAQ:VMED - 33.16).

  • Analysts at Macquarie this morning greeted HAL with an upgrade to "outperform" from "neutral," helping the shares jump some 3.4% so far today. Despite the security's 8.8% deficit for 2012, the sentiment picture is bullishly slanted, as 19 out of 26 brokerages consider HAL worthy of a "buy" or better endorsement. Elsewhere, optimism appears to be building in the options pits as well. During the past 10 days, HAL speculators on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have bought to open 3.24 calls for every put. This ratio arrives in the 76th percentile of its annual range, signaling that traders on these exchanges have purchased bullish bets over bearish at an accelerated clip over the past couple of weeks.

  • Another name enjoying an upgrade-related boost is PETM, after Barclays lifted its rating to "overweight" from "equal weight." The stock is sitting on a 34.5% year-to-date return, and could see more upside ahead, should the bearish holdouts reconsider their positions. There are currently 13 "holds," versus eight "buy" or better suggestions among the analyst bunch. Meanwhile, short interest fell 19.6% during the past two weeks, and now accounts for a meager 2.6% of PETM's available float.

  • Finally, VMED joined the broad-market upswing today, bouncing higher on a positive note from Nomura. Specifically, the firm upped its price target to $40 from $39, while keeping its "buy" rating intact. VMED has been quite a standout on the charts, outpacing the broader S&P 500 Index (SPX) by 23 percentage points during the past three months, and rocketing 55% since January. In light of this technical prowess, short sellers appear to be exiting their bearish bets. Over the most recent reporting period, short interest dipped 3.8%, but still makes up a considerable 13.8% of the equity's float. What's more, at the stock's average pace of trading, it would take more than seven sessions to buy back all of these shorted shares, which could translate into a contrarian tailwind for VMED, should short sellers continue to head toward the exits.

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