Analyst Downgrades: Fitbit Inc, Illumina, Inc., and Under Armour Inc

Analysts downwardly revised their ratings and price targets on Fitbit Inc (FIT), Illumina, Inc. (ILMN), and Under Armour Inc (UA)

by Kirra Fedyszyn

Published on Jan 11, 2016 at 9:24 AM

Analysts are weighing in on wearable tech specialist Fitbit Inc (NYSE:FIT), genetic analysis interest Illumina, Inc. (NASDAQ:ILMN), and athletic apparel concern Under Armour Inc (NYSE:UA)Here's a quick roundup of today's bearish brokerage notes on FIT, ILMN, and UA.

  • FIT is pointed 0.8% higher ahead of the bell, despite a steep price-target cut to $30 from $54 at Baird. Fitbit Inc hit a new low of $20.25 last Thursday, as traders jeered its new Blaze model, and closed out the week at $21.52. The latest bearish analyst note comes just after reports that many FIT user accounts have been hacked, and after a national class action lawsuit was filed. The stock has been struggling since August -- less than two months after it began trading publicly -- but 14 out of 20 brokerages providing coverage still call FIT a "buy" or better. Today's bounce could be an expected correction for the shares, as the equity's 14-day Relative Strength Index (RSI) of 25 is in oversold territory.
  • ILMN is set to pop 4.3%, after the firm said it will form a new company to enable early cancer screenings through a simple blood test. Still, Evercore ISI and Deutsche Bank slashed their price targets on the stock, to $177 and $178, respectively. Illumina, Inc. has been falling hard since the end of December, closing at $165.17 on Friday, but near-term option traders are more call-biased than usual. Specifically, ILMN has a Schaeffer's put/call open interest ratio (SOIR) of 0.81 -- lower than 92% of comparable readings from the past year. 
  • UA is off 5% in electronic trading, after closing at $75.00 on Friday. Morgan Stanley cut its rating on Under Armour Inc to "underweight," while lowering its price target to $62 from $103. D.A. Davidson also cuts its price target, to $105 from $123. The shares have been slipping for months, bringing their 14-day RSI to 27 -- in oversold territory. Meanwhile, short interest on UA currently accounts for 12.8% of the stock's available float , or nearly eight days' of trading, at typical volumes.

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