Analyst Downgrades: Oracle, Splunk , and Priceline

Analysts downwardly revised their ratings on ORCL, SPLK, and PCLN

Dec 2, 2014 at 9:28 AM
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Analysts are weighing in today on software providers Oracle Corporation (NYSE:ORCL) and Splunk Inc (NASDAQ:SPLK), as well as online travel portal Priceline Group Inc (NASDAQ:PCLN). Here's a quick roundup of today's bearish brokerage notes on ORCL, SPLK, and PCLN.

  • Despite rallying 20% year-over-year to trade at $42.08, ORCL was started with an "underweight" rating and $38 price target at J.P. Morgan Securities. The bearish initiation comes ahead of Oracle Corporation's next trip to the earnings stage, which is tentatively scheduled for later this month. Ahead of this event, short-term traders have shown a distinct preference for puts over calls. ORCL's Schaeffer's put/call open interest ratio (SOIR) registers at 1.08, or in the 87th percentile of its annual range.

  • J.P. Morgan Securities also initiated coverage on SPLK with a tepid "neutral" rating and $69 price target. This isn't particularly surprising, as the shares have given back 11.1% year-over-year to rest at their present perch of $63.73. Meanwhile, traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have been rolling the dice on additional downside for Splunk Inc. Specifically, the equity's 10-day put/call volume ratio across this trio of exchanges is 0.84, which rests in the top quartile of its 52-week range.

  • Finally, PCLN saw its rating reduced to "market perform" from "outperform" at FBR. Taking a step back, downgrades are relatively rare, as 16 out of the 17 brokerage firms covering the stock have handed out "buy" or better recommendations, compared to one "hold" and not a single "sell." In a similar vein, Priceline Group Inc's consensus 12-month price target of $1,334.60 represents a nearly 16% premium to the current price of $1,153.20. Such optimism seems unwarranted, given PCLN's 52-week deficit of 3%. In other words, the equity could be on the verge of additional bearish brokerage notes.

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