Analyst Downgrades: Nike Inc, Under Armour Inc, and BioMarin Pharmaceutical Inc.

Analysts downwardly revised their ratings and price targets on Nike Inc (NKE), Under Armour Inc (UA), and BioMarin Pharmaceutical Inc. (BMRN)

by Alex Eppstein

Published on Jun 1, 2016 at 9:22 AM
Updated on Jun 24, 2020 at 10:16 AM

Analysts are weighing in on athletic apparel peddlers Nike Inc (NYSE:NKE) and Under Armour Inc (NYSE:UA), as well as drug stock BioMarin Pharmaceutical Inc. (NASDAQ:BMRN). Here's a quick roundup of today's bearish brokerage notes on NKE, UA, and BMRN.

  • Morgan Stanley cut its rating on NKE to "equal weight," citing the loss of U.S. market share and a potential sales slowdown. The brokerage firm also slashed its price target to $60 from $69. As a result, Nike Inc is pointed 3.2% lower in electronic trading, after settling Tuesday at $55.22 -- down 11.6% in 2016. If the stock doesn't bounce back soon, another round of downgrades could ensue. Currently, 20 of 26 analysts rate the technical underperformer a "buy" or better. Meanwhile, bearish betting continues to run rampant in NKE's options pits.

  • Rival UA is also struggling pre-market, down 3.6%, after the company cut its full-year earnings and revenue forecasts due to the bankruptcy of retailer Sports Authority. Responding to the news, Susquehanna, Jefferies, Goldman Sachs, Cowen and Company, and Credit Suisse all lowered their price targets on Under Armour Inc. Longer term, the stock has had a rough 2016, losing 9.4% at $37.73, prompting a rush of short selling. During the last two reporting periods, short interest on UA exploded nearly 40%, and now accounts for 7% of the stock's float.

  • After BMRN withdrew its market authorization application for Kyndrisa in Europe, the drug stock saw its price target cut to $115 at SunTrust Robinson and to $111 at Leerink. As such, the shares are pointed 2.9% lower ahead of the bell, after settling at $89.65 yesterday. While BioMarin Pharmaceutical Inc. could start June off on the wrong foot, it had a strong May, tacking on nearly 6%. Not surprisingly, options traders have been extremely bullish toward the stock. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), speculators have bought to open 173.75 calls for each put in the past 10 days -- a margin that hasn't been surpassed over the prior year.
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