Analyst Update: Zillow, Enanta Pharma, and Cliffs

Analysts adjusted their ratings on Zillow Group Inc (Z), Enanta Pharmaceuticals Inc (ENTA), and Cliffs Natural Resources Inc (CLF)

Apr 6, 2015 at 11:26 AM
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Analysts are weighing in today on online real estate concern Zillow Group Inc (NASDAQ:Z), biotech firm Enanta Pharmaceuticals Inc (NASDAQ:ENTA), and commodity issue Cliffs Natural Resources Inc (NYSE:CLF). Here's a quick look at today's brokerage notes on Z, ENTA, and CLF.

  • Barclays lowered its rating on Z to "equal weight" from "overweight," while cutting its price target by $35 to $105, sending the shares down 1.9% to hit $99. On the charts, the shares have Zillow Group Inc remain 11.1% higher year-over-year, and could find support in the $95-$98 region, which has acted as a springboard since mid-2014. Short sellers remain prominent, as nearly 26% of Z's available float is sold short, which would take about eight and a half sessions to cover, at average trading volumes. However, short interest has declined by roughly 13.4% over the last two reporting periods. Should Z once again bounce off support, a continued exit of short sellers could spell tailwinds for the shares.

  • ENTA is 5.7% higher at $32.81, after Deutsche Bank initiated coverage on the stock with a "buy" rating and a $42 price target (representing a 28% premium to current trading levels). The upbeat opinion and price target are somewhat surprising, given the shares of Enanta Pharmaceuticals Inc have fallen 37.6% from their Dec. 29 all-time high of $52.58. This negative price action has piqued the interest of short sellers, as nearly one-third of ENTA's available float is sold short. Furthermore, it would take these traders about 11.6 sessions to cover their bets, at average trading volumes.

  • Deutsche Bank weighed in on a number of commodity firms this morning, cutting its price target on CLF to $5 from $7 while keeping its "hold" rating. Looking back, Cliffs Natural Resources Inc has been a technical underperformer, with the shares down 34.9% year-to-date to hit $4.64 -- despite a 1.2% gain today. Additionally, CLF notched an 11-year low of $4.12 on March 18. Sentiment in the options pits has been bullish, though, as the stock's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 3.03 ranks higher than 99% of all equivalent readings from the past year. Mirroring this indicator is CLF's Schaeffer's put/call open interest ratio (SOIR) of 1.05, which is the lowest such reading taken over the past year. Simply stated, short-term speculators have never been this call-heavy over the past 12 months.
 

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