Analyst Update: Kite, Procter & Gamble, Microchip Tech

Analysts adjusted their ratings on Kite Pharma Inc (KITE), Procter & Gamble Co (PG), and Microchip Technology Inc. (MCHP)

Alex Eppstein
Jan 19, 2016 at 2:52 PM
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Analysts are weighing in today on drugmaker Kite Pharma Inc (NASDAQ:KITE), consumer goods expert Procter & Gamble Co (NYSE:PG), and semiconductor stock Microchip Technology Inc. (NASDAQ:MCHP). Here's a quick roundup of today's brokerage notes on KITE, PG, and MCHP.

  • KITE received an upgrade to "outperform" at FBR. Nonetheless, the biotech stock is off 2.9% at $54, and has declined 40% since hitting an all-time high of $89.84 in mid-November. That hasn't prevented option traders from betting bullishly on Kite Pharma Inc in recent weeks. According to data at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), speculators have bought to open 7.52 calls for every put over the past 10 days. The corresponding call/put volume ratio ranks a mere 7 percentage points from a 12-month peak.

  • One week ahead of the company's quarterly earnings report, PG is getting a boost from a Stifel upgrade to "buy" -- with the brokerage waxing optimistic over the firm's cost-cutting program and dividend. At last check, the stock was 1.8% higher at $76.32, and earlier had found a foothold atop its 30-week moving average. At the ISE, CBOE, and PHLX, traders have been ramping up the bearish ante in recent weeks, per Procter & Gamble Co's 10-day put/call volume ratio of 2.22 -- in the 94th annual percentile. This negativity is reflected within the brokerage bunch, too, with 65% of covering analysts handing out "hold" or worse assessments. If next Tuesday morning's earnings can act as a catalyst higher, an unwinding among option bears and/or another round of upgrades could spark additional gains.

  • MCHP is rallying on news that its MOST150 Technology has been used in the new Volvo S90 automobile, and on some positive attention from Morgan Stanley. Specifically, the brokerage firm upped its rating to "overweight" and its price target to $55, sending the shares 1.7% higher at $41.20. Still, Microchip Technology Inc. is staring at a year-to-date deficit of 11.5%. Meanwhile, short sellers have been flocking toward the 2016 underperformer. Short interest grew 14.6% during the last reporting period, and now nearly one-tenth of MCHP's float is sold short. At the stock's average trading volumes, it would take about two weeks to cover these bets.
For other stocks in analysts' crosshairs, read Analyst Upgrades: Yahoo! Inc., Michael Kors Holdings Ltd, and Pandora Media Inc and Analyst Downgrades: Sarepta Therapeutics Inc, Fitbit Inc, and Express Scriptures Holding Company.

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