Analyst Update: United Rentals, Inc., Microsoft Corporation, and Cirrus Logic, Inc.

Analysts adjusted their ratings and price targets on United Rentals, Inc. (URI), Microsoft Corporation (MSFT), and Cirrus Logic, Inc. (CRUS)

by Kirra Fedyszyn

Published on Jan 28, 2016 at 2:52 PM

Analysts are weighing in today on equipment rental company United Rentals, Inc. (NYSE:URI), tech giant Microsoft Corporation (NASDAQ:MSFT), and Apple Inc. (NASDAQ:AAPL) supplier Cirrus Logic, Inc. (NASDAQ:CRUS). Here's a quick roundup of today's brokerage notes on URI, MSFT, and CRUS.

  • URI is down 18.6% at $45.50, just off a fresh two-year low of $45.36, after reporting quarterly earnings and issuing full-year guidance below analysts' expectations. In response, UBS downgraded the stock to "neutral" from "buy," and slashed its price target to $56 from $94. United Rentals, Inc. is now off 37.3% already in 2016 -- likely to the dismay of recent option buyers. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day call/put volume ratio of 3.19 is higher than 84% of all readings from the past 12 months. On the other hand, nearly 12% of URI's available float is sold short -- accounting for more than six days of trading, at the stock's typical pace.

  • Ahead of its earnings report, due after the close tonight, MSFT is 1.3% higher at $51.86. The shares have been slumping in 2016, down 6.5% so far, and are staring up at the $52-$53 region -- a former area of support that could now act as resistance. And just this morning, UBS cut its price target on Microsoft Corporation by $2 to $58 -- still near all-time high territory for the stock. Option traders are snatching up calls ahead of tonight's earnings. In fact, MSFT's Schaeffer's put/call open interest ratio (SOIR) of 0.46 is just 2 percentage points from an annual low -- showing near-term traders are close to a call-skewed extreme. And the options market seems to be pricing in a one-day post-earnings swing of 8.1% -- wider than the stock's average move of 4.8% over the last eight quarters. 

  • CRUS is trading a whopping 15.2% higher at $32.22, after reporting earnings that just topped expectations and giving a strong outlook for 2016 -- a much different path than partner Apple. Today's rally puts Cirrus Logic, Inc. about 9% higher year-to-date. Also helping the shares is an upgrade to "outperform" from "perform" at Oppenheimer (though Barclays cut its price target to $37 from $39). But option traders may be sweating today, as the equity's 10-day put/call volume ratio of 1.63 at the ISE, CBOE, and PHLX shows a heavy preference for puts over calls in recent weeks -- and sits in the 83rd annual percentile. Short sellers may be hitting the exits soon, too; about 12% of CRUS' float is sold, accounting for more than a week of trading, at the equity's average volume.
For other stocks in analysts' crosshairs, read Analyst Upgrades: Facebook Inc, Paypal Holdings Inc, and Kinder Morgan Inc and Analyst Downgrades: eBay Inc, QUALCOMM, Inc., and ServiceNow Inc.

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