Analyst Downgrades: Twitter Inc, SolarCity Corp, and Transocean LTD

Analysts downwardly revised their ratings and price targets on Twitter Inc (TWTR), SolarCity Corp (SCTY), and Transocean LTD (RIG)

by Alex Eppstein

Published on Feb 2, 2016 at 9:37 AM

Analysts are weighing in on social media maven Twitter Inc (NYSE:TWTR), alternative energy upstart SolarCity Corp (NASDAQ:SCTY), and offshore driller Transocean LTD (NYSE:RIG). Here's a quick roundup of today's bearish brokerage notes on TWTR, SCTY, and RIG.

  • Just a day after surging on outside investment rumblings, TWTR is down 4.3% at $17.14, after seeing its rating cut to "sell" from "hold" at Stifel Nicolaus. Specifically, the brokerage firm warned in a note, "Twitter's monthly active user growth continues to slow and is at risk of turning negative in 2016 due to a lack of product innovation and limited sense of urgency." In addition, Stifel set its price target at $14 -- in record-low territory. On the charts, Twitter Inc has been a disaster, losing 55% year-over-year to rest at $17.91. However, option traders have maintained a glass-half-full perspective. During the last 10 weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), TWTR has racked up a call/put volume ratio of 3.18 -- just 6 percentage points from an annual peak.

  • With a week to go before reporting earnings, SCTY was slapped with a $14 price-target cut to $45 at Goldman Sachs. As a result, the shares 1.8% lower at $33.17 -- down nearly 44% from their most recent high of $58.87 in mid-December. Should this negative momentum continue, SolarCity Corp can expect to see additional bearish brokerage notes. Of the 15 analysts tracking the stock, 13 have doled out a "buy" or better rating, compared to two "holds" and not a single "sell." Plus, SCTY's average 12-month price target of $66.67 stands in territory not explored since September 2014.

  • RIG is down 4.2% at $9.38, after Barclays slashed its price target on the stock to $6 from $11. The shares have surrendered nearly 46% of their value on a year-over-year basis, following the bearish lead of crude oil. Amid this drift lower, short sellers have been piling on Transocean LTD's bearish bandwagon. A lofty 37.5% of the stock's float is sold short -- an all-time high -- which would take over nine sessions to repurchase, at typical daily trading levels. 
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