Analyst Downgrades: Twitter Inc, Peabody Energy Corporation, and Community Health Systems

Analysts downwardly revised their ratings and price targets on Twitter Inc (NYSE:TWTR), Peabody Energy Corporation (NYSE:BTU), and Community Health Systems (NYSE:CYH)

Josh Selway

Feb 16, 2016 at 10:22 AM

Analysts are weighing in on social media stock Twitter Inc (NYSE:TWTR), energy concern Peabody Energy Corporation (NYSE:BTU), and healthcare stock Community Health Systems (NYSE:CYH). Here's a quick roundup of today's bearish brokerage notes on TWTR, BTU, and CYH.

Even though MKM Partners lowered its fair value estimate on the shares to $18 from $29, TWTR is enjoying an 0.8% post-Presidents Day jump to trade at $16.03 -- which shouldn't be too surprising. Longer term, though, Twitter Inc's given back almost 70% since its annual high of $53.49 back in April. However, if the shares can extend today's rally, they could benefit from an unwinding of pessimism in the options pits. Specifically, TWTR's 10-day put/call volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) of 0.72 is at an annual high.

BTU has fallen in step with the broader energy sector, hitting an all-time low last week of $2.15. Today, the shares are down 4.1% at $2.33, following a downgrade to "underweight" from "hold" at BB&T. Short sellers are hoping this negative price action continues. For instance, short interest increased by 14.6% during the two most recent reporting periods.

CYH has fallen 30.1% today to trade at $13.14 -- sending it straight to the short-sale-restricted list -- and earlier tagged a seven-year low of $12.88. Last night, the company announced an unexpected fourth-quarter loss -- prompting downgrades from Jefferies (to "hold") and Mizuho Securities (to "underperform"), with the former explaining it believes "investors will remain skeptical ... until CYH re-establishes a positive earnings track record." Today's bear gap has shares of Community Health Systems 80% below their all-time high of $65 from last June, and a recent batch of call buyers may be kicking themselves. Specifically, 10 long calls were purchased for every put during the past four weeks at the ISE, CBOE, and PHLX.

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