Analyst Upgrades: Lowe's, SunEdison, and Potash Corp

Analysts upwardly revised their ratings on LOW, SUNE, and POT

Nov 19, 2014 at 9:10 AM
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Analysts are weighing in today on home improvement retailer Lowe's Companies, Inc. (NYSE:LOW), alternative energy concern SunEdison Inc (NYSE:SUNE), and fertilizer firm Potash Corp./Saskatchewan (USA) (NYSE:POT). Here's a quick roundup of today's bullish brokerage notes on LOW, SUNE, and POT.

  • Unlike sector peer The Home Depot Inc. (NYSE:HD), LOW is poised for a post-earnings rally today. Specifically, the company's upwardly revised full-year forecast was met with a price-target hike to $64 from $62 at Morgan Stanley -- with the brokerage firm underscoring its "equal weight" rating -- sending the shares 5% higher ahead of the bell. Today's projected price movement only echoes Lowe's Companies, Inc.'s withstanding technical tenacity, with the stock boasting an impressive 18.1% year-to-date gain. A continued rise could prompt another round of bullish brokerage notes, as the majority of analysts covering the shares maintain a "hold" or "strong sell" suggestion, while the consensus 12-month price target of $57.83 stands at a discount to last night's close at $58.53.

  • SUNE had quite the day yesterday, surging 29.3% to settle at $21.48, on some well-received M&A news. The stock is ready to extend this momentum in today's session, thanks to price-target hikes at Needham (to $28) and Cowen and Company (to $33), with the brokerage firms reiterating their respective "buy" and "outperform" ratings. Year-to-date, the security is up nearly 65%, leaving the door wide open for an unwinding of skepticism -- which could help propel the shares higher. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), for example, SUNE's 50-day put/call volume ratio of 0.80 ranks 1 percentage point away from an annual bearish peak. Elsewhere, 30% of the equity's float is sold short, representing nearly a week's worth of pent-up buying demand, at SunEdison Inc's average daily pace of trading.

  • Susquehanna, TD Securities, and Raymond James all upped their price targets on POT, with the last of the trio also raising its rating to "outperform" from "market perform." On Tuesday, POT jumped 4.8% to close at $35.40, after Russian potash rival Uralkali OAO shuttered operations at one of its mines, and now sits 7.4% above its year-to-date breakeven level. On the sentiment front, option traders have been initiating bearish bets over bullish at a slightly accelerated clip in recent months, per POT's 50-day ISE/CBOE/PHLX put/call volume ratio of 0.49, which sits higher than 63% of similar readings taken in the past year. Echoing this put-skewed trend is POT's Schaeffer's put/call open interest ratio (SOIR) of 0.94, which ranks in the 80th percentile of its annual range. Simply stated, short-term speculators are more put-heavy than usual toward Potash Corp./Saskatchewan (USA).

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