Schaeffer's Trading Floor Blog

Analyst Update: Delta Air Lines, LSI, and Cummins

Analysts revised their ratings on DAL, LSI, and CMI

by 12/28/2012 8:49 AM
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Analysts are weighing in today on airline giant Delta Air Lines, Inc. (NYSE:DAL - 11.57), tech concern LSI Corp (NASDAQ:LSI - 6.91), and diesel engine manufacturer Cummins Inc. (NYSE:CMI - 106.80). Here's a quick roundup of today's revised brokerage notes.

  • Up about 43% so far this year, DAL scored a price-target hike to $14 from $13 at Raymond James this morning. The stock has also bested the broader S&P 500 Index (SPX) by more than 24 percentage points during the past three months, which could explain the bounty of optimism pervading the brokerage bunch. The security currently boasts nine "strong buys" and one "buy" endorsement, compared to one "hold" and zero "sell" suggestions. What's more, DAL's average 12-month price target of $15.77 reflects expected upside of more than 36% to Thursday's closing price of $11.57.

  • Up nearly 3% in pre-market trading, LSI was started with a "buy" recommendation at Wunderlich Securities ahead of the opening bell. The security has gained more than 16% in 2012, respectable price action that may have been attracting short-term bulls lately. The equity's Schaeffer's put/call open interest ratio (SOIR) sits at 0.14, confirming calls outstrip puts by a margin of about seven to one among options expiring in the next three months. This ratio ranks lower than all other readings taken within the last 12 months, meaning near-term traders are more call-heavy toward the stock now than at any other time during the past year.

  • CMI saw its price target lifted to $132 from $119 at Baird today, a move that could help add to the stock's year-to-date gain of more than 21%. Despite this technical strength, put volume continues to flourish on the stock. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows a 10-day put/call volume ratio of 1.48 for CMI, indicating puts bought to open have outnumbered calls during the past couple of weeks. This ratio resides in the 79th percentile of its annual range, conveying traders have been scooping up puts over calls at an accelerated clip.

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