Analyst Downgrades: American Airlines, Merck & Co

Analysts downwardly revised their ratings on American Airlines Group Inc (AAL), Merck & Co., Inc. (MRK), and Yingli Green Energy Hold. Co. Ltd. (ADR) (YGE)

Jun 8, 2015 at 9:55 AM

Analysts are weighing in today on flying fanatic American Airlines Group Inc (NASDAQ:AAL), drugmaker Merck & Co., Inc. (NYSE:MRK), and solar stock Yingli Green Energy Hold. Co. Ltd. (ADR) (NYSE:YGE). Here's a quick roundup of today's bearish brokerage notes on AAL, MRK, and YGE.

AAL is down 1.7% out of the gate at $40.99, as Raymond James downgraded the stock to "market perform" after CEO Doug Parker said capacity growth within the industry could weigh on profits. The shares' technical struggles are typical, as they've lost almost 24% year-to-date. Additional bearish analyst notes could further pressure American Airlines Group Inc. Currently, nine of 13 brokerage firms consider the equity a "buy" or better, versus four "holds" and not a single "sell." Plus, AAL's average 12-month price target of $64.77 sits in heights never before flown.

MRK saw its price target trimmed to $61 from $62 at Credit Suisse, which has the shares sitting a penny lower at $58.98. In recent weeks, the stock has been winding in the $59-$61 range, taking multiple bounces off its 120-day moving average -- currently located at $59.03. Despite this unmemorable price action, traders have bought to open Merck & Co., Inc. calls over puts at an accelerated clip, per recent data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Specifically, the security's 10-day call/put volume ratio of 4.41 across this trio of exchanges outranks 81% of comparable readings from the past year.

YGE has been a technical dud this year -- despite last Friday's big lift -- shedding 48.5% of its value to trade at $1.21. This includes a 7.6% drop this morning, following price-target cuts to $2 and $1.30 from RBC and Roth Capital, respectively. Amid this swoon, traders at the ISE, CBOE, and PHLX have been initiating long puts over calls at a rapid rate. Yingli Green Energy Hold. Co. Ltd. has amassed a 10-day put/call volume ratio of 1.78, which sits just 5 percentage points from a 12-month peak.

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