Analyst Update: Intel, ARM Holdings, Peabody Energy

Analysts are weighing in on INTC, ARMH, and BTU

Karee Venema
Oct 15, 2014 at 11:25 AM
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Stocks have taken a turn for the worse today, amid a number of growing concerns both here and abroad. Among equities in focus, tech issues Intel Corporation (NASDAQ:INTC) and ARM Holdings plc (ADR) (NASDAQ:ARMH), as well as coal concern Peabody Energy Corporation (NYSE:BTU) have all attracted the attention of analysts.

  • Disappointing sales in INTC's mobile and communications division have overshadowed a generally upbeat third-quarter earnings report, sending shares plunging 4% to $30.84 -- and analysts weighing in. No fewer than eight brokerage firms upped their price targets on INTC, but Morgan Stanley took the road less travelled, and cut its outlook on the stock to "underweight" from "equal weight." Today's sharp move lower only highlights the security's recent troubles, with shares of Intel Corporation down 8.3% from last Thursday's close at $33.62. Should the shares continue to struggle, another round of downgrades could apply additional pressure. At present, 16 covering analysts maintain a "strong buy" recommendation, versus 14 tepid "holds" and just two "sells."

  • Ahead of ARMH's turn in the earnings confessional after Tuesday morning, Canaccord Genuity reduced its price target on the stock to $55 from $58 -- and underscored its "buy" rating. However, this new target still represents expected upside of 38% to the security's current perch at $39.93, and should ARM Holdings plc (ADR) extend its 27% year-to-date deficit, another price-target cut could be on the horizon. Elsewhere, option traders have taken a decidedly bearish route, as evidenced by the stock's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio, which ranks in the 86th percentile of its annual range.

  • It's been a terrible year for BTU, with the shares down more than 46%. In today's session, the stock was last seen 3.1% lower at $10.47, after Imperial Capital started the security with an "underperform" rating -- and assigned certain senior notes with a "sell" recommendation -- citing increasing leverage and instability in the international coal community. Despite Peabody Energy Corporation's long-term technical troubles, pockets of optimism can still be found around the Street. In fact, 10 out of 15 analysts maintain a "buy" or better suggestion toward the stock, versus five "hold" or "sell" ratings. If BTU disappoints when it takes to the earnings stage ahead of next Monday's open, the door is wide open for another round of bearish brokerage notes.

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