Analyst Downgrades: Lululemon Athletica inc., JA Solar Holdings Co., Ltd., and Bank of America Corp

Analysts downwardly revised their ratings and price targets on Lululemon Athletica inc. (NASDAQ:LULU), JA Solar Holdings Co., Ltd. (ADR) (NASDAQ:JASO), and Bank of America Corp (NYSE:BAC)

Josh Selway

Nov 16, 2016 at 10:20 AM

Analysts are weighing in on yoga apparel firm Lululemon Athletica inc. (NASDAQ:LULU), solar energy name JA Solar Holdings Co., Ltd. (ADR) (NASDAQ:JASO), and bank stock Bank of America Corp (NYSE:BAC). Here's a quick roundup of today's bearish brokerage notes on LULU, JASO, and BAC.

LULU has dropped 1.2% to trade at $56.18, following a downgrade to "neutral" from "outperform" at Credit Suisse, which also slashed its price target to $53 from $76. Specifically, the brokerage firm said it has "less conviction in the company being able to sustain recent topline momentum," due to a string of markdowns. Given the stock's recent technical performance, this bear note isn't surprising. Lululemon Athletica inc. has given back 31% since its August high of $81.81, and more losses could be in store if other analysts following Credit Suisse's lead. For instance, 14 brokerage firms still consider LULU stock a "strong buy," and its 12-month price target resides at $68.64.
Credit Suisse also weighed in on JASO, initiating coverage with a "neutral" rating and $9.69 price target, while Axiom Capital lowered its rating on the stock to "sell" from buy" and the solar sector as a whole to "market underweight" from "market overweight." The latter specifically said it expects less favorable environmental policies from President-elect Donald Trump. As such, the shares are trading 0.4% lower at $5.49 -- continuing their consolidation in the $5.30-$5.50 region, after shedding 43% year-to-date. Meanwhile, short-term options traders have shown a preference for calls over puts. Specifically, JA Solar Holdings Co.'s Schaeffer's put/call open interest ratio (SOIR) comes in at a call-skewed 0.12, ranking below four-fifths of all similar readings from the past year.

Baird this morning suggested traders take profits from the recent surge in bank stocks, while lowering its rating on BAC to "neutral" -- though it bumped its price target to $18 from $17. Speaking of that surge, the stock has gained almost 17% since last week's presidential election, but is 1.7% lower today at $19.82. In the meantime, options traders have overwhelmingly been bullish. Bank of America Corp's 10-day call/put volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) comes in at a top-heavy 4.60, putting it in the 72nd percentile of its annual range.

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