Analyst Downgrades: Red Hat, Caterpillar, Mosaic Co

Analysts downwardly revised their ratings on Red Hat Inc (RHT), Caterpillar Inc. (CAT), and Mosaic Co (MOS)

Sep 22, 2015 at 9:25 AM

Analysts are weighing in today on software firm Red Hat Inc (NYSE:RHT), blue chip Caterpillar Inc. (NYSE:CAT), and fertilizer company Mosaic Co (NYSE:MOS). Here's a quick roundup of today's bearish brokerage notes on RHT, CAT, and MOS.

RHT reported better-than-expected earnings last night, as well as a 13% year-over-year increase in revenue. The company also upped its current-quarter and full-year guidance. None of that was enough to stop Cowen and Company from trimming its price target on the stock to $82 from $85, and sending it 1.7% lower ahead of the open. Technically speaking, Red Hat Inc has been consolidating atop its rising 50-week moving average for over one month, and closed yesterday at $72.72. Traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) are counting on a downturn. During the past 10 days across those exchanges, RHT has racked up a put/call volume ratio of 1.27 -- just 9 percentage points from an annual high.

CAT has lost more than one-fifth of its value year-to-date, at $72.16. In fact, the stock sits just 2.7% above its nearly four-year low of $70.23, which it skimmed in late August. Caterpillar Inc. is on track to give back another 1.6% at the open, after SocGen cut its price target by $6 to $104. In the options pits, traders have been upping the bearish ante, as well. CAT's 50-day ISE/CBOE/PHLX put/call volume ratio checks in at 2.00, with long puts doubling calls. On top of that, this ratio is higher than 89% of comparable readings recorded in the past 12 months.

Citing weak demand, MOS announced it will reduce its potash output, and lowered its current-quarter sales guidance. Adding insult to injury, Canaccord Genuity and Susquehanna reduced their respective price targets to $35 and $50, pressuring the shares 3.3% lower in pre-market trading. It's already been a brutal 2015 for Mosaic Co, which has surrendered one-fifth of its value to close Monday at $36.44 -- after hitting an intraday (and six-year) low of $36.13. Option bulls, however, have kept the faith. MOS' 10-day ISE/CBOE/PHLX call/put volume ratio of 5.66 outranks 78% of comparable readings from the past year.

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