Analyst Downgrades: Amex, American Eagle Outfitters

Analysts downwardly revised their ratings on American Express Company (NYSE:AXP), American Eagle Outfitters (NYSE:AEO), and United Natural Foods, Inc. (NASDAQ:UNFI)

by Karee Venema

Published on Sep 15, 2015 at 9:41 AM
Updated on Jul 2, 2020 at 2:41 PM

Analysts are weighing in on blue-chip credit card concern American Express Company (NYSE:AXP), specialty retailer American Eagle Outfitters (NYSE:AEO), and organic food specialist United Natural Foods, Inc. (NASDAQ:UNFI). Here's a quick roundup of today's bearish brokerage notes on AXP, AEO, and UNFI.

  • A solid August has led to a lackluster September for AXP, with the shares off 2.1% month-to-date. The stock is extending this downturn today -- and widening its 19% 2015 deficit to trade at $75.14 -- after Susquehanna lowered its price target on AXP to $95 from $99. Elsewhere on the Street, sentiment is upbeat toward the laggard. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), for example, American Express Company's 10-day call/put volume ratio of 2.88 ranks in the 92nd annual percentile. In other words, calls have been bought to open over puts at a near-annual-high clip.

  • AEO has put in a strong performance on the charts this year -- up almost 13% at $15.66. B. Riley seems unconvinced the equity can sustain this momentum, though, and lowered its price target to $18 from $21. This follows yesterday's downgrade to "neutral" from "buy." The brokerage firm isn't the only one to take a skeptical stance toward the stock. Short interest surged 15.2% in the last two reporting periods, and now accounts for almost one-quarter of AEO's available float -- or 4.1 days' worth of pent-up buying demand. Should American Eagle Outfitters add to its year-to-date gains, a capitulation from short sellers could translate into a fresh burst of buying power.

  • Ahead of its trip to the earnings confessional tonight, UNFI saw its price-target cut to $50 from $59 at RBC. Still, the shares are holding tough, last seen 0.2% higher at $50. The stock has struggled recently, though, with UNFI roughly 35% lower on the year, and fresh off an Aug. 7 three-year low of $44.05. Option traders have been bracing for more downside, per United Natural Foods, Inc.'s 10-day ISE/CBOE/PHLX put/call volume ratio of 1.98. Echoing this put-heavy trend is the security's Schaeffer's put/call open interest ratio (SOIR) of 2.30 -- in the 91st annual percentile.

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