Analyst Downgrades: EXACT Sciences, Groupon, Starbucks

Analysts downwardly revised their ratings on EXAS, GRPN, and SBUX

by Alex Eppstein

Published on Oct 31, 2014 at 9:29 AM
Updated on Jul 2, 2020 at 1:40 PM

Analysts are weighing in today on molecular diagnostics firm EXACT Sciences Corporation (NASDAQ:EXAS), coupon king Groupon Inc (NASDAQ:GRPN), and java giant Starbucks Corporation (NASDAQ:SBUX). Here's a quick roundup of today's bearish brokerage notes on EXAS, GRPN, and SBUX.

  • Canaccord Genuity lowered its price target on EXAS by $2 to $30, but maintained its "buy" rating. This, despite the shares more than doubling in value this year to trade at $24.81. Skepticism toward EXACT Sciences Corporation can be found among short sellers, as well, as 32.6% of the stock's float is sold short -- which would take nearly eight sessions to buy back, at the equity's average daily trading levels. That said, if EXAS can maintain its positive technical trajectory, a capitulation among the shorts could further boost the shares.

  • GRPN's turn in the earnings confessional was decidedly mixed, as an earnings beat was counterbalanced by lower-than-expected current-quarter guidance. The analyst reaction, likewise, is split. Specifically, B. Riley and Evercore Partners lowered their respective price targets on Groupon Inc -- and maintained their "buy" and "sell" ratings -- while Credit Suisse and RBC both raised their price targets, while sustaining their "neutral" and "sector perform" assessments. Ahead of the bell, the stock is nearly 9% higher, but is sitting on a year-to-date loss of roughly 49% at $5.99. In the options pits, short-term traders have shown a stronger-than-usual affinity for puts over calls recently. GRPN's Schaeffer's put/call open interest ratio (SOIR) of 0.85 ranks in the put-skewed 97th percentile of its annual range.

  • Finally, slower-than-expected fiscal fourth-quarter sales -- as well as a weaker-than-expected current-quarter outlook -- are pressuring SBUX south this morning, despite news of a future coffee delivery service. At last check, the stock -- which settled at $77.32 last night, or just below year-to-date breakeven -- was 2.8% lower ahead of the open. Also weighing on Starbucks Corporation were price-target cuts at Baird (to $88 from $92) and J.P. Morgan Securities (to $82 from $85) -- though the pair of firms underscored their respective "outperform" and "overweight" opinions. In the options pits, meanwhile, traders have been scooping up bearish bets over bullish at an extreme pace in recent months. Specifically, SBUX's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 1.17 sits in the top percentile of its annual range.

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