Analyst Downgrades: First Solar, Inc., Bank of America Corp, and Wells Fargo & Co

Analysts downwardly revised their ratings and price targets on First Solar, Inc. (FSLR), Bank of America Corp (BAC), and Wells Fargo & Co (WFC)

by Kirra Fedyszyn

Published on Jul 7, 2016 at 10:01 AM

Analysts are weighing in on alternative energy issue First Solar, Inc. (NASDAQ:FSLR), as well as financial stocks Bank of America Corp (NYSE:BAC) and Wells Fargo & Co (NYSE:WFC). Here's a quick roundup of today's bearish brokerage notes on FSLR, BAC, and WFC.

  • FSLR is off 6.1% at $46.12 after Deutsche Bank downgraded the stock to "hold" from "buy" and lowered its price target to $44 from $80, citing a slower pace in bookings, and pricing pressures. First Solar, Inc. has already given up more than 30% of its value in 2016, but out of 18 analysts following the stock, 10 rate it a "strong buy," and not a single one recommends selling it. Options traders, meanwhile, have reached a pessimistic extreme in recent weeks. In fact, FSLR's 10-day put/call volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits at the very top of its annual range, at 3.00 -- indicating three of the stock's puts have been bought to open for every call over the last two weeks.

  • BAC is 1.6% higher at $13.07, as global banking stocks attempt a recovery today. But a downgrade to "market perform" from "outperform" at Raymond James, which also lowered its full-year earnings estimate for Bank of America Corp, is likely keeping the shares from bigger gains. The stock is off 22% on a year-to-date basis, and could be headed for more trouble, should additional analysts abandon their upbeat outlooks. At present, 16 out of 21 brokerage firms rate BAC a "buy" or better, without a sell in sight. Plus, the average 12-month price target of $17.22 sits at a 31% premium to the stock's current value, leaving the door wide open for future cuts.

  • WFC is up 1% at $47.14, shaking off a downgrade to "market perform" from "outperform" at Raymond James and a price-target cut to $48 from $58 at Nomura. The shares have been struggling for months, and just hit a two-year low of $44.50 in late June. It's little surprise, therefore, that options traders have taken a bearish view of Wells Fargo & Co recently. In fact, the stock's 50-day ISE/CBOE/PHLX put/call volume ratio of 1.00 sits higher than 90% of all readings in the last 12 months.
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