Analyst Upgrades: DreamWorks, VeriFone, and Denny's

Analysts upwardly revised their ratings on Dreamworks Animation Skg Inc (NASDAQ:DWA), VeriFone Systems Inc (NYSE:PAY), and Denny's Corporation (NASDAQ:DENN)

Jun 5, 2015 at 9:24 AM
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Analysts are weighing in on filmmaker Dreamworks Animation Skg Inc (NASDAQ:DWA), electronic payment issue VeriFone Systems Inc (NYSE:PAY), and restaurant chain Denny's Corporation (NASDAQ:DENN). Here's a quick roundup of today's bullish brokerage notes on DWA, PAY, and DENN.

  • Stifel raised its outlook on DWA to "buy" from "hold," and set a $34 price target -- representing expected upside of 23.8% to last night's close at $27.46, and a trip into annual-high territory. Specifically, the brokerage firm views the company's pipeline of younger-audience films as a positive. The stock has performed well since hitting a 52-week low of $18.16 in late January, up 51.2%. While the shares look poised to extend this momentum today -- and are up 5% ahead of the bell -- Dreamworks Animation Skg Inc could encounter resistance near $28. This area has contained the equity's advances since March 2014. Short sellers could be keeping a close eye on today's price action, considering more than 18% of the stock's float is sold short. What's more, it would take over a month to cover all of DWA's shorted shares, at average daily trading levels.

  • PAY is looking to buck its historical post-earnings trend, as the firm's lackluster current-quarter forecast overshadows a fiscal second-quarter earnings beat. Not even a round of upbeat analyst notes is helping the stock, which was last seen down 3.5% in electronic trading. Weighing in on VeriFone Systems Inc was Susquehanna, BMO, and Wedbush, which raised their respective price targets to $44, $45, and $47 -- all levels not surpassed by PAY since May 2012. Longer term, the security is up 13.4% year-over-year, due to several big bounces off its 320-day moving average. In fact, the stock hit a three-year high of $39.25 on Wednesday, and settled at $38.35 yesterday. Meanwhile, option traders have been buying to open puts over calls at a rapid-fire rate in recent months, per PAY's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.23, which rests at an annual high.

  • In addition to adding DENN to its "Best Ideas" list, Wedbush also raised its rating on the stock to "outperform" from "neutral," and boosted its price target to $14 from $11. Not only does this new target stand at a 32.5% premium to Thursday's close at $10.57, but also a move into record-high waters. While the stock is boasting an impressive 61.4% year-over-year lead -- and is pointed 4.1% higher in pre-market action -- DENN has struggled a bit since hitting an all-time peak of $12.10 in mid-April. More recently, the equity has been sandwiched between support at its 160-day moving average and resistance in the $11 region. On the sentiment front, Denny's Corporation's gamma-weighted Schaeffer's put/call open interest ratio (SOIR) of 0.26 indicates near-the-money call open interest almost quadruples put open interest among options expiring in three months or less.

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