Analyst Update: VMware, Chipotle, and Yahoo! Inc.

Analysts adjusted their ratings on VMware, Inc. (VMW), Chipotle Mexican Grill, Inc. (CMG), and Yahoo! Inc. (YHOO)

Oct 21, 2015 at 12:47 PM
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Analysts are weighing in today on tech concern VMware, Inc. (NYSE:VMW), restaurant operator Chipotle Mexican Grill, Inc. (NYSE:CMG), and Internet search giant Yahoo! Inc. (NASDAQ:YHOO). Here's a quick roundup of today's brokerage notes on VMW, CMG, and YHOO.

  • VMW is 17.5% lower this afternoon at $56.73 (up slightly from a five-year low of $55.11, touched earlier) after the firm forecast current-quarter revenue below analysts' estimates and announced a new project with its parent company. Also, VMware, Inc. received bearish notes from no fewer than 18 brokerages, with the largest price-target cut courtesy of Mizuho Securities (to $60 from $75). Option bulls flocked to VMW ahead of the earnings report -- per its 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 2.20 -- and a capitulation among this bunch could further the stock's fall. 

  • CMG is 6.8% lower at $657.99, as the restaurant operator's third-quarter earnings disappointed Wall Street and the company projected weak same-store sales growth. The report triggered price-target cuts from no fewer than eight analysts, with the deepest cut coming from Barclays (to $660 from $685). One arena where Chipotle Mexican Grill, Inc.'s price action may be welcome is the option pits, where traders seemed to be counting on a break lower after the report. Specifically, the equity's 50-day ISE/CBOE/PHLX put/call volume ratio of 1.28 ranks in the 84th percentile of its annual range. On the charts, the stock is currently finding a floor in the form of its 80-week moving average, but is now in negative year-to-date territory.

  • YHOO continues our parade of disappointing earnings this afternoon, as the company reported quarterly results that fell short of the Street's estimates, and trimmed its revenue guidance. At last check, the stock has dropped 4% to $31.50. Throwing salt on the wounds, B. Riley and Mizuho both cut their ratings to "neutral," with the latter being one of at least 13 brokerages to issue a downward price-target revision. However, Citigroup and Piper Jaffray each elevated their price targets to $38 and $33, respectively. Option players stocked up on bearish bets heading into the earnings release, per the firm's 10-day put/call volume ratio on the ISE, CBOE, and PHLX of 0.92 -- which sits 5 percentage points below a 52-week high. Elsewhere, future downgrades remain a possibility, as 20 of the 26 analysts tracking YHOO rate it a "buy" or better, with not a single "sell" in sight.
For other stocks in analysts' crosshairs, read Analyst Upgrades: Intuitive Surgical Inc., Coach Inc, and Cree, Inc. and Analyst Downgrades: Twitter Inc, Micron Technology, Inc., and Western Digital Corp.

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