Analyst Downgrades: Ambarella Inc, NRG Energy Inc, and Zumiez Inc.

Analysts downwardly revised their ratings on Ambarella Inc (AMBA), NRG Energy Inc (NRG), and Zumiez Inc. (ZUMZ)

Dec 1, 2015 at 9:48 AM
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Analysts are weighing in on semiconductor maker Ambarella Inc (NASDAQ:AMBA), power company NRG Energy Inc (NYSE:NRG), and apparel peddler Zumiez Inc. (NASDAQ:ZUMZ). Here's a quick roundup of today's bearish brokerage notes on AMBA, NRG, and ZUMZ.

  • Deutsche Bank cut its price target on AMBA to $70 from $85. The downward revision is well-deserved, as the stock has fallen hard since touching a record high of $129.19 in late July, though it was last seen 2.7% higher at $64.53. On the fundamental front, Ambarella Inc will report third-quarter earnings on Thursday evening. Ahead of the event, short sellers have been upping the bearish ante. During the most recent two-week reporting period, short interest on AMBA rose 6.2%, and now represents 45.8% of the stock's total float. At typical trading levels, it would take over one week to buy back these positions.
  • NRG has lost over half its value on a year-to-date basis, and touched a record low of $11.51 yesterday. At last check, the stock is flat at $12.36, even though Citigroup initiated coverage with a "sell" rating and an $11 price target. Speaking more generally, though, the brokerage crowd has taken a sunny-side-up approach toward NRG Energy Inc. Eighty percent of covering analysts have handed out "buy" or better opinions, and the security's consensus 12-month price target of $23.31 sits at a nearly 90% premium to current levels.
  • ZUMZ, which is slated to report earnings Thursday night, is off 1.1% this morning at $14.93, following a downgrade to "market perform" at William Blair. This is business as usual for a stock that had given up three-fifths of its value year-to-date heading into today's session. Amid this long-term swoon, short sellers have been active. Nearly 20% of Zumiez Inc.'s float is sold short, representing two weeks' worth of trading activity, given typical volumes. Also, short-term traders have shown a distinct preference toward puts over calls. ZUMZ's Schaeffer's put/call open interest ratio (SOIR) of 1.07 ranks in the 79th percentile of its annual range.

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