Analyst Downgrades: Wells Fargo & Co, Cree, Inc., and First Solar, Inc.

Analysts downwardly revised their ratings and price targets on Wells Fargo & Co (NYSE:WFC), Cree, Inc. (NASDAQ:CREE), and First Solar, Inc. (NASDAQ:FSLR)

Josh Selway

Apr 6, 2016 at 10:04 AM

Analysts are weighing in on bank stock Wells Fargo & Co (NYSE:WFC), lighting specialist Cree, Inc. (NASDAQ:CREE), and solar energy stock First Solar, Inc. (NASDAQ:FSLR). Here's a quick roundup of today's bearish brokerage notes on WFC, CREE, and FSLR.

WFC is down 0.3% at $47.40 this morning, after Guggenheim cuts its rating on the stock to "neutral" from "buy." Separately, the company said it has a "robust plan in place" to address new fiduciary regulations from the Department of Labor regarding retirement planning. The stock's been under pressure in 2016, losing nearly 13%. More struggles could be in store, too, if bullish speculators throw in the towel. That's because nearly two Wells Fargo & Co call options have been bought to open for every put option during the past two weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX).

CREE is getting destroyed this morning, falling 16.6% to $24.22, after the company announced a dreadful preliminary fiscal third-quarter forecast. In response, Cowen and Company and Canaccord Genuity lowered their price targets to $23 and $20, respectively, The shares are now flirting with their three-year low from November, gapping below recent support in the $29 area. This is just fine with short sellers, though, who control 16% of Cree, Inc.'s float. At average daily volumes, it'd take these bears almost 12 sessions to cover.

FSLR is down 0.3% at $62.26, after receiving no fewer than four price-target reductions. The most bearish note came from Mizuho, which lowered its price target to $67 from $71. The stock has pulled back since hitting a two-year high of $74.29 on March 18, but appears to have found support from its 120-day moving average. If this level holds up and First Solar, Inc. can rally, it could benefit from an exodus of options bears. More specifically, FSLR's 50-day put/call volume ratio at the ISE, CBOE, and PHLX of 0.92 ranks in the 88th percentile of its annual range.

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