Analysts downwardly revised their ratings and price targets on Alcoa Inc (AA), Juniper Networks, Inc. (JNPR), and Starbucks Corporation (SBUX)
Analysts are weighing in on aluminum stock
Alcoa Inc (NYSE:AA), tech firm Juniper Networks, Inc. (NYSE:JNPR), and java giant Starbucks Corporation (NASDAQ:SBUX). Here's a quick roundup of today's bearish brokerage notes on AA, JNPR, and SBUX. - AA is bracing for a 2.9% drop out of the gate, after the company kicked off earnings season on a mixed note -- with earnings topping estimates, but revenue dropping 15% year-over-year and coming up shy of expectations. Adding insult to injury, Stifel lowered its price target on the stock to $13 from $14. Still, there's no doubting Alcoa Inc's longer-term technical strength, as the shares have rallied nearly 59% since hitting a six-year low of $6.14 in late January to trade at $9.74. Traders have been betting against AA at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), too. The stock's 50-day put/call volume ratio of 0.92 sits just 6 percentage points from an annual high. If Alcoa manages to shrug off a likely earnings setback and continues its prevailing trend northward, a capitulation among the bears could add fuel to its fire.
- JNPR reported lackluster preliminary first-quarter results last night, lowering previous guidance due to weak demand from enterprise customers. As a result, analysts are piling on the bearish bandwagon, with no fewer than six cutting their price targets on the stock. RBC set the lowest bar, slashing its outlook to $24 from $26. Ahead of the bell, Juniper Networks, Inc. is down 7% after closing yesterday at $24.89, suggesting the shares will break lower from their sideways pattern in the $25-$26 range. Options traders would likely welcome such a move, considering they've bought to open 2.79 JNPR puts for every call during the past 10 days at the ISE, CBOE, and PHLX -- yielding a put/call volume ratio that sits in the bearishly skewed 85th annual percentile.
- Deutsche Bank lowered its rating on SBUX to "hold" from "buy," and cut its price target to $64 from $70, citing decelerating sales and earnings trends. "We believe the combination of lofty near-term investors' expectations, operational changes and a premium valuation creates a less favorable risk-reward on the shares," the brokerage firm wrote. The bearish note is taking a toll on Starbucks Corporation ahead of the open, with the stock down 2.2%. However, since flirting with $52 in early February, the shares have picked up steam (in line with historical trends), and settled Monday at $60.90. Not surprisingly, the majority of analysts remain in SBUX's bullish corner, with 19 of 23 doling out a "buy" or better assessment -- and not a single "sell" opinion on the books.
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