Analyst Update: Morgan Stanley, QUALCOMM, Palo Alto

Analysts adjusted their ratings and price targets on Morgan Stanley (MS), QUALCOMM, Inc. (QCOM), and Palo Alto Networks Inc (PANW)

Feb 16, 2016 at 3:17 PM
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Analysts are weighing in on financial concern Morgan Stanley (NYSE:MS), tech stock QUALCOMM, Inc. (NASDAQ:QCOM), and cybersecurity interest Palo Alto Networks Inc (NYSE:PANW). Here's a quick roundup of today's brokerage notes on MS, QCOM, and PANW.

  • MS is 2.4% higher at $23.64, after J.P. Morgan Securities upgraded the stock --and this blue-chip peer -- to "overweight" from "neutral," while also lowering its price target to $29 from $33. In addition, traders are mulling comments from new Minnesota Fed President Neel Kashkari regarding banks that are still "too big to fail." The stock -- like many of its sector comrades -- has been in a downtrend since last July, and has shed more than a quarter of its value already if 2016, hitting a two-year low last week on news that the company will have to pay a $3.2 billion settlement for its role in the 2008 mortgage crisis. Morgan Stanley has underperformed the S&P 500 Index (SPX) by more than 24 percentage points over the past three months, but nearly half of analysts still rate the security a "buy" or better.
  • Bernstein raised its rating on QCOM to "outperform," sending the shares up 4.7% to $46.64, despite Jana Partners reducing its stake in the company by 67.7%. QUALCOMM, Inc. has been moving lower for more than 18 months, hitting a five-year low of $42.24 just last week, not long after issuing a weak current-quarter outlook. But option traders have been eyeing a rebound for the stock. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 50-day call/put volume ratio of 4.83 outranks 94% of all readings from the past year. 
  • PANW is also higher today, up 3.9% at $128.57, after D.A. Davidson upgraded the stock to "buy" from "neutral." The brokerage firm set its price target at a healthy $186 -- a 44.7% premium to PANW's current price. Analysts have been quite bullish on Palo Alto Networks Inc lately, with 24 out of 28 brokerage firms rating it a "buy" or better, despite the shares underperforming the SPX by more than 26 percentage points over the last two months. In fact, the stock hit a yearly low of $111.09 just last week, and is off 27.1% year-to-date. But option traders have maintained their optimism, as well -- PANW's 10-day call/put volume ratio at the ISE, CBOE, and PHLX is in the 90th percentile of its annual range, at 1.77. The company will report its fiscal second-quarter earnings next Thursday.
For other stocks in analysts' crosshairs, read Analyst Upgrades: Goldman Sachs Group Inc, Micron Technology, Inc., and BioMarin Pharmaceutical Inc. and Analyst Downgrades: Twitter Inc, Peabody Energy Corporation, and Community Health Systems.

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