Schaeffer's Trading Floor Blog

Analyst Downgrades: Skullcandy, Darden Restaurants, and Huntington Bancshares

Analysts downwardly revised their ratings on SKUL, DRI, and HBAN

by 12/13/2012 9:12 AM
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Analysts are weighing in today on audio accessories manufacturer Skullcandy Inc (NASDAQ:SKUL - 8.60), restaurateur Darden Restaurants, Inc. (NYSE:DRI - 45.80), and banking issue Huntington Bancshares Incorporated (NASDAQ:HBAN - 6.25). Here's a quick roundup of today's bearish brokerage notes.

  • Down more than 31% so far this year, SKUL saw its price target lowered to $12 from $15 at Northland Capital this morning. The equity has also trailed the broader S&P 500 Index (SPX) by more than 33 percentage points during the past 40 sessions, yet SKUL is still seeing plenty of short-term call activity. The stock's Schaeffer's put/call open interest ratio (SOIR) sits at 0.68, with calls comfortably outstripping puts among options expiring in three months or less. This ratio arrives in the 39th annual percentile, denoting a stronger-than-usual preference for near-term calls over puts.

  • DRI -- which has tacked on about 6% over the last 12 months -- was downgraded to "neutral" from "buy" at Goldman Sachs today. Elsewhere, the equity continues to find itself under the bearish microscope. Short interest on the security rose by roughly 4% during the most recent reporting period. These bearish bets now represent a healthy 6% of the stock's available float. In fact, it would take nearly eight days to buy back these shorted shares, at DRI's average daily trading volume.

  • Despite a year-over-year climb of more than 24%, HBAN was cut to "underperform" from "market perform" at KBW ahead of the opening bell. Meanwhile, 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 4.10, indicating traders have bought to open more than four calls for every put during the past few months. This ratio ranks higher than 71% of similar readings taken within the past year, meaning speculators have been scooping up calls over puts at an accelerated pace.

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