Analyst Downgrades: Micron Technology, Inc., Square Inc, and Target Corporation

Analysts downwardly revised their ratings and price targets on Micron Technology, Inc. (MU), Square Inc (SQ), and Target Corporation (TGT)

Mar 31, 2016 at 9:55 AM

Analysts are weighing in on chipmaker Micron Technology, Inc. (NASDAQ:MU), payment processor Square Inc (NYSE:SQ), and retail stock Target Corporation (NYSE:TGT). Here's a quick roundup of today's bearish brokerage notes on MU, SQ, and TGT.

MU is down 1.1% at $10.37 after reporting a slimmer-than-expected fiscal second-quarter loss, while revenue fell short of predictions. Macquarie and Bernstein both downgraded the stock -- to "neutral" and "market perform," respectively -- while no fewer than 10 analysts lowered their price targets, to a range between $10 and $16. Micron Technology, Inc. has given up 29% of its value already this year, and bearish sentiment in the option pits has been running high. Still, further downgrades from the brokerage crowd could push the shares toward new multi-year lows, since the majority of analysts on Wall Street recommend buying MU.

After hitting an all-time high of $15.13 on Wednesday, SQ is off 3.1% at $14.56 this morning, as BTIG and Monness Crespi Hardt both lowered their ratings on the stock to "neutral" from "buy." And while the shares have nearly doubled from their early February low of $8.06, analysts and short sellers have remained bearish on Square Inc. Option traders, however, have gone a different route, buying to open more than six SQ calls for each put during the last 10 sessions on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX).

Barclays downgraded TGT to "underweight" from "overweight" while slashing its price target to $70 from $90, sending the shares 2.8% lower to $81.30. Since tapping a one-year low of $66.46 in late January, Target Corporation has been heading sharply higher, breaking out above its 80-day moving average last month, which served as resistance since last August. And while overall sentiment in the option pits has been rather pessimistic in recent weeks, near-term traders have been more call-heavy than usual. TGT's Schaeffer's put/call open interest ratio (SOIR) of 0.78 shows calls outstripping puts among options expiring in the next three months. Moreover, this ratio is lower than 86% of all readings in the past 12 months.

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