Analyst Downgrades: Ariad, Travelers, Goodrich Petro

Analysts downwardly revised their ratings on ARIA, TRV, and GDP

by Andrea Kramer

Published on Dec 11, 2014 at 9:55 AM
Updated on Jul 2, 2020 at 1:28 PM

Analysts are weighing in today on drugmaker Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA), blue-chip insurance issue Travelers Companies Inc (NYSE:TRV), and oil-and-gas firm Goodrich Petroleum Corporation (NYSE:GDP). Here's a quick roundup of today's bearish brokerage notes on ARIA, TRV, and GDP.

  • ARIA has stumbled 3.3% to $6.77, after Credit Suisse downgraded the stock to "underperform" from "neutral," and slashed its price target to $6 from $8. The stock is now testing a foothold atop its 200-day moving average, which served as long-term resistance until late November. Today's downgrade marks a change of pace for Ariad Pharmaceuticals, Inc., which sports six "strong buys" and four "hold" recommendations, with not a single "sell" in sight. However, pessimism isn't a total stranger; short interest represents nearly 27% of ARIA's total available float.

  • Despite notching a record high of $106.13 on Monday, TRV was downgraded to "neutral" from "buy" at UBS. Nevertheless, the Dow component was last seen 0.5% higher at $104.79, bringing its year-to-date surplus to 15.7%. Just eight out of 21 analysts consider Travelers Companies Inc worthy of a "buy" or better rating, and the average 12-month price target of $98.67 represents a discount to the stock's current price. In the same skeptical vein, the equity's Schaeffer's put/call open interest ratio (SOIR) is docked at an annual high of 1.94, implying short-term options players haven't been more put-biased during the past year.

  • Finally, GDP is up 2.7% at $3.83, despite RBC and KLR Group cutting their respective price targets to $14 and $6. However, both brokerage firms maintained the equivalent of "buy" ratings, and their revised targets still represent serious premiums to GDP's current perch. Yesterday, Goodrich Petroleum Corporation cut its 2015 exploration and production spending forecast, as crude oil plumbed five-year lows. The company also said it would explore options for its Eagle Ford shale stake. GDP shares are down roughly 77.5% in 2014, and fell to a decade-plus low of $2.96 earlier this week. What's more, a mass exodus of bullish holdouts could exacerbate selling pressure on the stock, as more than half the analysts following GDP uphold "buy" or better opinions, and the average 12-month price target of $16.53 is more than four times the stock's price.

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