Analyst Downgrades: Peabody Energy Corporation, Lifelock Inc, and Yahoo! Inc.

Analysts downwardly revised their ratings on Peabody Energy Corporation (NYSE:BTU), Lifelock Inc (NYSE:LOCK), and Yahoo! Inc. (NASDAQ:YHOO)

by Karee Venema

Published on Jul 22, 2015 at 9:56 AM
Updated on Jul 22, 2015 at 9:59 AM

Analysts are weighing in on coal concern Peabody Energy Corporation (NYSE:BTU), identity theft issue Lifelock Inc (NYSE:LOCK), and search engine specialist Yahoo! Inc. (NASDAQ:YHOO). Here's a quick roundup of today's bearish brokerage notes on BTU, LOCK, and YHOO.

  • It's been a dismal run for BTU, shedding 92% of its value during the last 52 weeks -- and hitting a record low of $1.12 on Monday. In today's session, the stock is off 2.5% at $1.17, after J.P. Morgan Securities downgraded its outlook to "neutral" from "overweight," saying BTU is under "extreme pressure" from short sellers. In fact, short interest surged 35% in the past two reporting periods, and now accounts for almost two-fifths of Peabody Energy Corporation's available float. Next week, the firm is scheduled to report earnings the morning of Tuesday, July 28.

  • LOCK had a terrible day on Tuesday -- plunging 49%, after the Federal Trade Commission (FTC) levied stiff allegations against the company. The brokerage bunch was quick to offer its two cents, with no fewer than four firms chiming in on the stock. RBC, for example, downgraded LOCK to "sector perform" from "outperform," and slashed its price target by $9 to $11. Elsewhere, Wunderlich Securities cut its outlook to "hold" from "buy," and lowered its price target to $9.25 from $20. Despite these bearish brokerage notes, Lifelock Inc is up 9.5% at the open to trade at $8.92. Considering its 14-day Relative Strength Index (RSI) closed last night at 11 -- deep in oversold territory -- a near-term bounce may have been in the cards. Looking ahead, LOCK earnings are tentatively scheduled for next week.

  • YHOO is down 2.7% out of the gate to linger near $38.67, after the firm -- along with several of its peers -- issued disappointing earnings. What's more, a handful of analysts cut their price targets on the shares, including BMO (to $46) and Evercore ISI (to $47). Cantor and Pivotal Research, meanwhile, bucked the trend by boosting their respective price targets to $62 -- territory YHOO hasn't charted since August 2000 -- and $43. Today's post-earnings price action is likely being celebrated in the options pits. Yahoo! Inc.'s 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.59 ranks in the 94th annual percentile. In other words, puts have been bought to open over calls at a near-annual-high clip.
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