Analyst Downgrades: Fiat Chrysler Automobiles NV, United Continental Holdings Inc, and Netflix, Inc.

Analysts downwardly revised their ratings and price targets on Fiat Chrysler Automobiles NV (FCAU), United Continental Holdings Inc (UAL), and Netflix, Inc. (NFLX)

Jul 6, 2016 at 9:29 AM
facebook twitter linkedin

Analysts are weighing in on automaker Fiat Chrysler Automobiles NV (NYSE:FCAU), airline stock United Continental Holdings Inc (NYSE:UAL), and streaming specialist Netflix, Inc. (NASDAQ:NFLX). Here's a quick roundup of today's bearish brokerage notes on FCAU, UAL, and NFLX.

  • FCAU is 2.5% lower ahead of the open, after Barclays downgraded the stock's rating to "underweight" from "overweight," while also cutting its price target nearly in half to 5.5 euros. Fiat Chrysler Automobiles NV closed Tuesday at $5.68, after hitting a new annual low -- and the shares are on track to tap yet another low out of the gate. While the stock has underperformed the broad S&P 500 Index (SPX) by a painful 26 percentage points over the last two months, options traders have been picking up bullish bets at an unusually rapid pace. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), FCAU's 10-day call/put volume ratio of 14.66 sits higher than 80% of all readings in the last year.

  • Credit Suisse lowered its rating on UAL to "neutral" from "outperform" and slashed its price target to $42 from $64, while Deutsche Bank cut its price target on the stock to $50 from $62. The shares are pointed 3.2% lower pre-market as a result, set to add to their nearly 30% year-to-date loss, as of last night's close at $40.29. United Continental Holdings Inc has been falling hard since April, and touched a nearly two-year low of $37.41 just last week. The airline stock could be in for even more pain if additional brokerages issue bearish notes. More than half of analysts currently rate the stock a "strong buy," without a "sell" rating on the books. Plus, the average 12-month price target sits well overhead, at $62.92 -- leaving the door wide open for more downgrades and/or price-target cuts, should UAL continue to underperform.

  • It feels like déjà vu for NFLX this morning, with the shares down 2.5% in pre-market trading after Jefferies initiated coverage on the stock with a downbeat "underperform" rating and an $80 price target -- below which shares of Netflix, Inc. haven't settled in more than a year. "Although NFLX's runway will span multiple years, our research suggests the domestic subscriber growth trajectory may be somewhat flatter than the market's current expectations," an analyst from the brokerage firm commented. The stock managed a sharp rebound off of the $85 level last week, but is down more than 14% year-to-date at $97.91. Yesterday, NFLX bucked the broad-market headwinds to close higher, after the firm inked a fresh agreement to carry shows from The CW Network, as well as a deal with cable provider Comcast Corporation (NASDAQ:CMCSA).
Sign up now for Schaeffer's Opening View newsletter to get a head start on all the major pre-market news!

Now is the time to join our thriving community of Event Traders who consistently profit from every earnings season. With this discounted subscription opportunity, you'll stay ahead of the curve and seize opportunities others miss. Do not let Q3 earnings season pass you by – subscribe now and supercharge your portfolio with expert insights that turn market reactions into profit-generating opportunities!! Don't waste another second... join us right now before the next trade targeting +200% is released!