Buzz Stocks: Kate Spade & Co, AutoZone, Ocwen Financial

Today's stocks to watch in the news include Kate Spade & Co (KATE), AutoZone, Inc. (AZO), and Ocwen Financial Corp (OCN)

Mar 3, 2015 at 9:25 AM
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U.S. benchmarks appear ready to take a breather today, following Monday's historic session. In company news, today's stocks to watch include high-end fashion designer Kate Spade & Co (NYSE:KATE), car parts seller AutoZone, Inc. (NYSE:AZO), and mortgage lender Ocwen Financial Corp (NYSE:OCN).

  • KATE's latest turn in the earnings confessional was mixed, as the company's adjusted per-share profit of 24 cents fell short of the consensus estimate, but its sales were better than expected. On the charts, the stock has added 10.3% year-to-date to trade at $35.30. This technical tenacity has led to accelerated call buying at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Specifically, Kate Spade & Co's 50-day call/put volume ratio of 4.24 rests above 90% of comparable readings from the last year.

  • AZO topped the Street's consensus earnings and sales forecasts for its fiscal second quarter, helped by higher inventory levels and new store openings. As such, the shares are nearly 4% higher in electronic trading, putting them on pace for a record peak out of the gate. AutoZone, Inc. closed Monday at $649.53, just below last Friday's all-time high of $651.95. Despite this impressive price action, AZO is facing skepticism from analysts. Fifteen out of 18 brokerage firms have designated the equity a "hold" or worse, and its average 12-month price target of $639.44 stands below current trading levels -- potentially paving the way for a round of upgrades and/or price-target hikes. On the flip side, option traders have blazed a more bullish path toward AZO.

  • Finally, OCN has agreed to sell the servicing rights on $45 billion in Fannie Mae loans to an undisclosed party, just a week after a similar $9.8 billion sale. The company is trying to raise money to offset mounting legal expenses. On the charts, Ocwen Financial Corp has had a rough go of it, surrendering nearly 77% of its value over the last 52 weeks to trade at $8.54 -- though the security is pointed 6.6% higher in electronic trading. Short sellers have turned up the heat, too, as short interest rose 29% during the most recent reporting period, and now makes up 38.8% of the stock's total float.
 

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