Analyst Downgrades: Yelp, Baidu, Agios Pharmaceuticals

Analysts downwardly revised their rating on Yelp Inc (NYSE:YELP), Baidu Inc (ADR) (NASDAQ:BIDU), and Agios Pharmaceuticals Inc (NASDAQ:AGIO)

Apr 30, 2015 at 9:31 AM
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Analysts are weighing in today on online review platform Yelp Inc (NYSE:YELP), Chinese Internet provider Baidu Inc (ADR) (NASDAQ:BIDU), and biopharmaceutical firm Agios Pharmaceuticals Inc (NASDAQ:AGIO). Here's a quick roundup of today's bearish brokerage notes on YELP, BIDU, and AGIOS.

  • The shares of YELP are 16.5% lower in pre-market trading -- and poised to explore annual lows -- after the company's first-quarter earnings and current-quarter guidance failed to meet the Street's expectations. In response, no fewer than 14 brokerage firms lowered their price-targets and/or ratings on Yelp Inc, with the largest cuts coming from Evercore ISI (to $41) and Baird (to $46). YELP had already been a technical underperformer heading into today's session, with the shares down 6.3% year-to-date to settle Wednesday at $51.28. However, short-term traders have been more call-heavy than usual, as YELP's Schaeffer's put/call open interest ratio (SOIR) of 0.67 is lower than 74% of all similar readings from the past year. A mass exodus of option bulls could exacerbate selling pressure on the stock.
  • It's a similar story for the shares of BIDU, down 3.3% ahead of the bell, after the firm posted mediocre first-quarter revenue growth. Reacting were Piper Jaffray and Pacific Crest, which lowered their price targets to $230 and $255, respectively -- though both brokerage firms reaffirmed their "overweight" ratings. On the charts,Baidu Inc (ADR) has taken a step back recently, with the shares down 13.1% from their Nov. 13 all-time high of $251.99 to close yesterday at $219. What's more, the shares have struggled beneath their 200-day moving average, which has acted as a level of resistance since February. Accordingly, puts have been prominent in the options pits, as BIDU's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.66 ranks in the 99th percentile of its annual range. Elsewhere, 12 out of 13 covering analysts rate the stock a "strong buy."
  • Canaccord Genuity lowered its price target on AGIO to $103 from $163 while downgrading its rating to "hold" from "buy," citing concerns over the drugmaker's glioma drug AG-120. Specifically, the brokerage firm said, "Agios will present data for AG-120 in solid tumors by 2H15, which we believe may only show modest benefit in these patients ... Therefore, we decrease our probability of success for AG-120 in glioma to 30% from 80%." At last check, the shares of Agios Pharmaceuticals Inc -- which closed at $99.32 last night -- were down 2.9% in electronic trading. Year-to-date, the shares are down 11.4%. Despite this downtrend, traders have preferred calls over puts ahead of AGIO's trip to the earnings confessional on May 7. Over the past 10-days at the ISE, CBOE, and PHLX, 3.71 AGIO calls have been bought to open for every put.

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