Analyst Downgrades: Twitter, American Int, Avalanche

Analyst Downgrades: Twitter, American International Group, and Avalanche Biotech

Jun 16, 2015 at 9:23 AM
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Analysts are weighing in today on social media concern Twitter Inc (NYSE:TWTR), insurance behemoth American International Group Inc (NYSE:AIG), and biopharmaceutical concern Avalanche Biotechnologies Inc (NASDAQ:AAVL). Here's a quick roundup of today's bearish brokerage notes on TWTR, AIG, and AAVL.

  • TWTR is down 1% ahead of the bell -- and could hit new annual lows for a second straight session -- as analysts apparently aren't excited by the company's recent front-office change. MKM Partners downgraded the stock to "neutral" from "buy" and reduced its price target by $18 to $39, saying it doesn't expect Twitter Inc's user growth woes to end anytime soon. TWTR is currently sitting in a 3.3% year-to-date hole, finishing yesterday at $34.67, and it could be hurt by additional bearish notes if it can't turn things around. Eleven of 25 brokerage firms with coverage on the shares maintain "strong buy" endorsements, while their average 12-month price target sits at $47.35 -- a 36.6% premium to current levels.

  • Deutsche Bank's downwardly revised outlook on AIG has the shares 0.7% lower before the open. The brokerage firm cut its assessment on the stock to "hold" from "buy," even though AIG has outperformed the S&P 500 Index (SPX) by almost 11 percentage points in the past three months, and yesterday touched a multi-year high of $63.70 before settling at $62.57. Still, short-term option traders are more put-heavy than usual. American International Group Inc's Schaeffer's put/call open interest ratio (SOIR) comes in at 1.46, revealing put open interest among options expiring in the next three months greatly outweighs call open interest. Plus, this reading marks an annual put-skewed extreme. 

  • AAVL is getting annihilated in pre-market action, poised to surrender nearly half its value -- and explore all-time lows -- after the company reported disappointing trial results for its experimental eye therapy. Even before this potentially huge bear gap, Avalanche Biotechnologies Inc was down 28% in 2015 at $38.88. Now, analysts are jumping on the bearish wagon, as SunTrust Robinson and William Blair each lowered their ratings to the equivalent of "neutral." Plus, the former more than halved its price target to $25. There's a good chance this isn't the last batch of bearish brokerage attention for AAVL: five of six analysts consider it was a "strong buy."

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