Analyst Downgrades: Pandora Media, Yelp, and Gilead

Analysts downwardly revised their ratings on Pandora Media Inc (P), Yelp Inc (YELP), and Gilead Sciences, Inc. (GILD)

Feb 6, 2015 at 9:19 AM
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Analysts are weighing in today on Internet radio issue Pandora Media Inc (NYSE:P), online review firm Yelp Inc (NYSE:YELP), and biopharmaceutical stock Gilead Sciences, Inc. (NASDAQ:GILD). Here's a quick roundup of today's bearish brokerage notes on P, YELP, and GILD.

  • To the delight of yesterday's big options bear, P is bracing for a 20% plunge out of the gate, after a fourth-quarter revenue miss was met with a round of bearish brokerage attention. CRT Capital was among the many weighing in on the stock, slashing its price target by $10 to $16, and underscoring its "fair value" rating. Wells Fargo and Raymond James were also included in the bunch -- both downgrading P to "market perform" from "outperform." Technically speaking, the equity has been charting a path lower for some time -- resulting in a nearly 43% year-over-year loss to trade at $18.41 -- and short sellers have been rolling the dice on more downside. Short interest ramped up 11.6% in the latest reporting period, and now accounts for 15% of Pandora Media Inc's available float.

  • A number of brokerage firms chimed in on YELP, after the company posted its first-ever profit in the fourth quarter, but said user growth slowed. Evercore ISI, for example, cut its price target by $11 to $49, and reiterated its "hold" rating, while B. Riley reduced its outlook to "sell" from "neutral." Against this backdrop, shares of YELP are down 16% in electronic trading -- and poised to move into the red on a year-to-date basis. Should the equity extend this negative post-earnings price action, another round of downgrades and/or price-target cuts -- or an unwinding of optimism in the options pits -- could be on the horizon. Currently, 70% of covering analysts maintain a "buy" or better rating on Yelp Inc, while the average 12-month price target of $80.68 stands at a 40% premium to last night's close at $57.47.

  • It's been a rough week for GILD, which is down 4.7% from last Friday's close to trade at $99.90. The equity is on pace to extend these losses in today's trading, after Credit Suisse downgraded GILD to "neutral" from "outperform," and reduced its price target by $15 to $115, citing Tuesday's dreary revenue outlook. Longer term, though, GILD still remains more than 30% higher year-over-year, and most analysts remain in the bullish corner. Of the 17 brokerage firms following the stock, 13 maintain a "buy" or better rating, versus three "holds" and one "sell." Plus, the consensus 12-month price target of $120.13 for Gilead Sciences, Inc. stands in territory yet to be charted.


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