Analyst Downgrades: Netflix, Achillion, and Wal-Mart

Analysts downwardly revised their ratings on Netflix, Inc. (NASDAQ:NFLX), Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN), and Wal-Mart Stores, Inc. (NYSE:WMT)

Oct 15, 2015 at 10:09 AM
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Analysts are weighing in on streaming giant Netflix, Inc. (NASDAQ:NFLX), biotech Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN), and blue chip Wal-Mart Stores, Inc. (NYSE:WMT). Here's a quick roundup of today's bearish brokerage notes on NFLX, ACHN, and WMT.

  • NFLX is taking a hit this morning, dropping over 9% to $100.14, following last night's round in the earnings booth. Traders are particularly concerned with the company's weak subscriber figures, which it blamed on a consumer transition to chip-based credit cards. Regardless, the shares are still more than 100% higher year-to-date, and many on the Street remain hopeful. While FBN Securities, Raymond James, and Credit Suisse all lowered their price targets, the stock was still the recipient of no fewer than seven price-target increases, with J.P Morgan Securities and BofA-Merrill Lynch both setting their targets at $137 -- representing record-high territory. Elsewhere, Netflix, Inc. saw a 15.3% increase in short interest over the last two reporting periods, suggesting there's now plenty of sideline cash to drive the shares higher if they can resume their longer-term uptrend. 

  • ACHN is down 1.7% at $7.07, following a price-target cut at Jefferies to $7. More broadly speaking, analysts are split, with four saying the equity is a "strong buy" and four others saying it's a "hold" or worse. Short sellers, though, have been extremely active. Short interest on Achillion Pharmaceuticals, Inc. represents roughly one-quarter of its float, and would take more than seven days to repurchase, at average daily volumes. This likely has something to do with ACHN's long-term technical struggles; the security was off 41.3% year-to-date, even before today's open. 

  • WMT got crushed yesterday, after a top executive issued a drastic earnings warning. The stock is struggling again today, amid a round of bearish analyst attention. Specifically, BofA-Merrill Lynch and Stephens cut their opinions to the equivalent of a "hold," as did Credit Suisse -- which was one of nearly a dozen brokerage firms that lowered their price targets on the stock. Now Wal-Mart Stores, Inc. is 0.4% lower at $59.77, and earlier touched a three-year low of $59.45. Most of Wall Street is already arrayed against the security, though. Only three of 22 covering analysts rate WMT a "buy." 
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