Analyst Downgrades: Gap, Baidu, and Petroleo Brasileiro

Analysts downwardly revised their ratings on Gap Inc (NYSE:GPS), Baidu Inc (ADR) (NASDAQ:BIDU), and Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR)

by Josh Selway

Published on Sep 30, 2015 at 10:06 AM
Updated on Jul 2, 2020 at 2:46 PM

Analysts are weighing in on apparel retailer Gap Inc (NYSE:GPS), Chinese search specialist Baidu Inc (ADR) (NASDAQ:BIDU), and oil-and-gas expert Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR). Here's a quick roundup of today's bearish brokerage notes on GPS, BIDU, and PBR.

  • GPS got hit with a range of bearish attention from the Street this morning, after Stefan Larsson -- credited for revitalizing the company's Old Navy brand -- was named CEO of Ralph Lauren Corp (NYSE:RL). No fewer than seven brokerage firms have lowered their price targets on the stock, with Mizuho and UBS also cutting their outlooks to the equivalent of a "sell." The shares are now 8.1% lower at $27.76 -- and fresh off a three-year low of $27.72. This price action should please one group of traders, at least. Short interest represents almost 11% of Gap Inc's float, and would take more than six days to repurchase, at normal daily volumes. 

  • BIDU is shrugging off a downgrade to "hold" from "buy" at Summit Research, which also lowered its price target to $150 from $205, citing falling margins. Specifically, the shares are starting the day 0.9% higher at $137.91 -- attempting to make up some of their 40% year-to-date deficit -- after unveiling two new faces on its board of directors. Most brokerage firms on the Street are certainly believers. Eight out of nine covering analysts say Baidu Inc is a "strong buy." What's more, the equity's average 12-month price target of $214.28 stands at a 55% premium to current levels. 

  • Macquarie started PBR with an "underperform" rating and $2.80 price target, but you wouldn't know it by looking at the stock today. The shares are 8.6% higher at $4.22, with traders instead reacting to reports the company is raising its gasoline and diesel prices. Still, Petroleo Brasileiro Petrobras SA has been horrible on the charts, trailing the S&P 500 Index (SPX) by more than 48 percentage points during the past three months. In the meantime, put buying has picked up. PBR's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 1.02 outranks 93% of all readings from the past year. 

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