Analyst Upgrades: Dollar General, HP, Valeant Pharma

Analysts upwardly revised their ratings on Dollar General Corp. (DG), Hewlett-Packard Company (HPQ), and Valeant Pharmaceuticals Intl Inc (VRX)

Feb 23, 2015 at 9:19 AM
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Analysts are weighing in today on discount retailer Dollar General Corp. (NYSE:DG), tech name Hewlett-Packard Company (NYSE:HPQ), and pharmaceutical company Valeant Pharmaceuticals Intl Inc (NYSE:VRX). Here's a quick roundup of today's bullish brokerage notes on DG, HPQ, and VRX.

  • J.P. Morgan Securities resumed coverage on DG this morning, setting a price target of $85 with an "overweight" rating. As for the other analysts tracking the shares, sentiment remains mixed. Ten of the covering brokerage firms deem the stock a "strong buy," with the nine others calling it a "hold" or worse. In Dollar General Corp.'s options pits, though, speculators' outlook is decidedly bearish. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security's 50-day put/call volume ratio of 1.18 is in its 96th annual percentile, meaning traders have bought to open puts versus calls at a faster clip only 4% of the time in the past year. DG has been solid of late, technically speaking, closing at $71.69 on Friday for a 7% month-to-date gain.

  • On a long-term basis, HPQ has been strong on the charts, adding roughly 29% in the past 52 weeks. In 2015, though, it's been a different story, with the stock off over 4%, finishing Friday at $38.39. BMO, however, is looking past the shares' recent struggles, raising its price target by $1 to $43, and keeping its "market perform" recommendation. The tentatively positive note, which has the stock 0.2% higher in electronic trading, comes ahead of Hewlett-Packard Company's earnings report, scheduled for tomorrow after the close. Ahead of this event, option traders are positioning themselves in the bulls' corner. The equity's 10-day ISE/CBOE/PHLX call/put volume ratio of 2.43 is higher than four-fifths of all such readings from the past year.

  • VRX is seeing a pre-market surge, gaining 8.8%, after announcing it has finalized a $10.1 billion deal to acquire Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP). In response, Cantor Fitzgerald boosted its price target on VRX to $214 from $184, while maintaining its "buy" assessment -- mirroring the general sentiment on the Street. Specifically, 11 of 13 covering analysts call Valeant Pharmaceuticals Intl Inc a "buy" or better, with the remaining two handing out "hold" opinions. The stock had already been gaining on the charts in 2015, tacking on 21% since the start of the year. Regardless, short-term speculators have taken a put-biased approach. VRX's Schaeffer's put/call open interest ratio (SOIR) of 2.34 is only 4 percentage points from an annual high. Said differently, speculative traders have rarely been more put-skewed.
 

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