Analyst Downgrades: Pandora, Stratasys, and Luminex

Analysts are weighing in today on Pandora Media Inc (P), Stratasys, Ltd. (SSYS), and Luminex Corporation (LMNX)

Feb 3, 2015 at 9:28 AM
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Analysts are weighing in today on streaming music giant Pandora Media Inc (NYSE:P), 3-D printing specialist Stratasys, Ltd. (NASDAQ:SSYS), and biological testing firm Luminex Corporation (NASDAQ:LMNX). Here's a quick roundup of today's bearish brokerage notes on P, SSYS, and LMNX.

  • J.P. Morgan Securities cut its price target on P to $34 from $35 -- and underscored its "overweight" rating -- although this new forecast is double last night's close at $16.95. Technically speaking, the stock has been on a steady downtrend since topping out at a record peak of $40.44 last March, down 58%. Should Pandora Media Inc turn in a poorly received earnings report after this Thursday's close, another round of bearish brokerage notes could be on the horizon. Currently, 77% of covering analysts maintain a "buy" or better rating, while the average 12-month price target of $28.78 stands at a 70% premium to P's present perch.

  • SSYS is bracing for a 28% drop out of the gate -- and a move into annual-low territory -- after another downwardly revised fourth-quarter profit estimate and weak fiscal 2015 forecast was met with a round of bearish analyst attention. J.P. Morgan Securities, for example, slashed its price target by $43 to $70, while Brean Capital reduced its outlook to "hold" from "buy." Since hitting its most recent high of $125 in early November, the stock has surrendered 36% under the weight of its 40-day moving average, and settled last night at $80.08. This has more than likely been music to the ears of short sellers. Short interest rose 4.4% in the latest reporting period, and now accounts for more than one-fifth of Stratasys, Ltd.'s available float.

  • LMNX received price-target cuts from Leerink (to $18), Jefferies (to $17), and Wedbush (to $18), after the firm offered up a lower-than-expected 2015 revenue outlook. Since being swiftly rejected by the round-number $20 mark in mid-January, shares of LMNX have shed 12%, and closed last night at $17.68. Options traders have kept the faith, though, and -- at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) -- have bought to open 25 calls for every put over the past 10 sessions. Echoing this call-skewed trend is Luminex Corporation's Schaeffer's put/call open interest ratio (SOIR) of 0.87, which ranks lower than 76% of similar readings taken in the past year. Simply stated, short-term speculators are more call-heavy than usual.
 

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