Analyst Update: Take-Two Interactive Software, Inc., Chesapeake Energy Corporation, and Michael Kors Holdings Ltd

Analysts adjusted their ratings on Take-Two Interactive Software, Inc. (NASDAQ:TTWO), Chesapeake Energy Corporation (NYSE:CHK), and Michael Kors Holdings Ltd (NYSE:KORS)

by Kirra Fedyszyn

Published on Nov 3, 2015 at 12:40 PM

Analysts are weighing in today on video game maker Take-Two Interactive Software, Inc. (NASDAQ:TTWO), energy concern Chesapeake Energy Corporation (NYSE:CHK), and designer retail label Michael Kors Holdings Ltd (NYSE:KORS). Here's a quick roundup of today's brokerage notes on TTWO, CHK, and KORS.

  • TTWO received a price-target hike to $40.64 from $33.78 at Benchmark. The video game creator -- last seen trading 0.5% higher at $33.80 -- is up 20.1% year-to-date, but is currently seeing strong bearish interest. In particular, Take-Two Interactive Software, Inc. currently sports a Schaeffer's put/call open interest ratio (SOIR) of 1.92, in the 92nd percentile of its annual range, implying that near-term traders have rarely been more put-heavy during the past year. Likewise, TTWO has racked up a 50-day put/call volume ratio of 2.22 on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) -- higher than 97% of readings in the last 52 weeks, indicating that puts are being bought over calls at a much quicker rate than normal. Short interest also accounts for over 18% of the stock's float. Analysts don't seem to share the bearish outlook on TTWO, maintaining seven "strong buys," four "holds," and not a "sell" rating in sight. Meanwhile, competitor Activision Blizzard, Inc. (NASDAQ:ATVI) is seeing some downward movement after announcing plans to buy mobile game maker King Digital Entertainment PLC (NYSE:KING). Take-Two, which will report earnings after the bell on Thursday, has averaged a one-day post-earnings move of 7.7%, going back eight quarters.

  • CHK, November's biggest historic underperformer, was last seen trading at $7.71, up 3.5%, thanks to a broader energy rally. Ahead of earnings tomorrow morning, Chesapeake Energy Corporation received a rating demotion to "market perform" from "outperform" at Bernstein, which also halved its price target to $9 from $18. Deutsche Bank also gave the energy concern a price-target reduction, to $8 from $10. Not surprisingly, analysts are wary of CHK, which is down more than 60% year-to-date. Just three brokerage firms offer up "buy" or better opinions, compared to 16 "hold" or worse ratings. Historically, the stock has averaged a one-day post-earnings swing of 6.6%, going back eight quarters, but its near-term at-the-money straddle is pricing in a larger move of 9.7%.

  • KORS -- which will also report earnings tomorrow morning -- recently got a short-lived boost from a billionaire's investment in the firm, but the stock remains in striking distance of annual-low territory. Meanwhile, KORS was hit with a price-target drop to $37 from $45 at Canaccord Genuity, which believes the brand "continues to struggle to regain the allure it once had." The retailer was last seen up 0.5% at $39.16, but still sits on a 47.8% year-to-date loss. While 16 of the 20 brokerage firms following the security give it a lukewarm "hold" or worse, the options pits have seen a huge influx of bullish bets. Michael Kors Holdings Ltd has a 10-day call/put volume ratio of 5.58 on the ISE/CBOE/PHLX -- in the 98th percentile of all readings in the past year. The options market is pricing in a 10.9% post-earnings move for KORS, based on near-term ATM straddle data. Over the past eight quarters, the stock has averaged a swing of 9.5% in the session after reporting.
For other stocks in analysts' crosshairs, read Analyst Upgrades: Amazon.com, Inc. (AMZN), MBIA Inc. (MBI), and Pfizer Inc. (PFE) and Analyst Downgrades: American International Group Inc (AIG), Qualys Inc (QLYS), and NVIDIA Corporation (NVDA)

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