Analyst Downgrades: Verizon, Coach Inc, and AK Steel

Analysts downwardly revised their ratings on VZ, COH, and AKS

Dec 9, 2014 at 9:43 AM
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Analysts are weighing in today on blue chip Verizon Communications Inc. (NYSE:VZ), luxury retailer Coach Inc (NYSE:COH), and commodities concern AK Steel Holding Corporation (NYSE:AKS). Here's a quick roundup of today's bearish brokerage notes on VZ, COH, and AKS.

  • VZ is down 4.2% at $46.87, after the firm warned that wireless price cuts and promotional offers would put "short-term pressure" on its current-quarter earnings. The stock was subsequently downgraded to "neutral" from "outperform" at Baird, which also trimmed its price target to $50 from $54. In the same vein, Cowen and Company and Macquarie cut their respective price targets to $51 and $46, and both maintained the equivalent of "neutral" ratings. On the charts, Verizon Communications Inc. is now 4.6% south of its year-to-date breakeven level, and could be vulnerable to more analyst backlash; 19 out of 24 brokerage firms maintain "buy" or better opinions.

  • UBS trimmed its price target on COH by $1 to $34, and held its "neutral" rating. Most analysts are wary of Coach Inc, which sports just six "buy" or better endorsements, compared to 12 "holds" and two "sell" or worse recommendations. Technically speaking, it's not difficult to see why Wall Street is skeptical, as COH has surrendered roughly 40% in 2014, and was last seen 1% lower at $33.70. The shares have spent the past few months testing their mettle atop the $32-$33 region, with rebound attempts halted by their 20- and 32-week moving averages.

  • Finally, AKS initially dipped after Cowen and Company reduced its price target to $10 from $11, but the stock has since bounced back, adding 0.8% to flirt with $5.40. Longer term, the security has shed well over one-third of its value year-to-date, and has underperformed the broader S&P 500 Index (SPX) by about 44 percentage points during the past three months. It's not surprising, then, to find just three out of 11 analysts consider AK Steel Holding Corporation a "strong buy," and that short interest accounts for more than 30% of the stock's float.
 

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