Analyst Downgrades: Autodesk, Seadrill, and Aeropostale

Analysts downwardly revised their ratings on Autodesk, Inc. (NASDAQ:ADSK), Seadrill Ltd (NYSE:SDRL), and

Aug 28, 2015 at 9:39 AM
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Analysts are weighing in on software specialist Autodesk, Inc. (NASDAQ:ADSK), oil-and-gas issue Seadrill Ltd (NYSE:SDRL), and specialty retailer Aeropostale Inc (NYSE:ARO). Here's a quick roundup of today's bearish brokerage notes on ADSK, SDRL, and ARO.

  • Last night, ADSK reported a drop in second-quarter revenue and downwardly revised its full-year forecast -- prompting a round of negative analyst attention. BofA-Merrill Lynch, for example, lowered its price target to $45 from $48, while Wedbush cut its target price by $6 to $51. Against this backdrop, the stock is 4.8% lower out of the gate at $47.61, widening its year-to-date deficit to over 20%. In the options pits, it appears traders have been bracing for a post-earnings plop. Autodesk, Inc.'s 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 1.48 ranks in the 87th annual percentile. Simply stated, puts have been bought to open over calls at a faster-than-usual clip. 

  • It's been a volatile week for SDRL, which has been tracking the whipsaw price action in the commodities market. Today, the shares are down 3.3% to $7.14, following a price-target cut to $7 from $10 at Credit Suisse. While the brokerage firm said the company was being "proactive" in lowering its debt ratio, it hasn't done enough. Overall, the shares have surrendered more than 40% year-to-date, and there's plenty of room for more price-target cuts to come down the pike. Currently, Seadrill Ltd's  consensus 12-month price target of $12.98 stands at an 82% premium to current levels.

  • ARO is off 9.2% this morning at $1.14, after the company -- unlike sector peer Abercrombie & Fitch Co. (NYSE:ANF) -- posted its 11th straight quarterly loss. Also pressuring the shares are price-target cuts at Jefferies (to $1.25), SunTrust Robinson (to $1.35), and Mizuho (to $1.50). Today's price move is just more of the same for a stock that's shed nearly 51% year-to-date, and bottomed at a record low of $1.02 on Monday. As such, short sellers have been cashing in their winning bets, with short interest down 6.2% in the latest reporting period. However, these bearish bets still account for more than a quarter of Aeropostale Inc's available float, or 10.7 times the stock's average daily trading volume.

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