Analyst Downgrades: Citigroup Inc, Imperva Inc, and Netflix, Inc.

Analysts downwardly revised their ratings and price targets on Citigroup Inc (C), Imperva Inc (IMPV), and Netflix, Inc. (NFLX)

Jul 12, 2016 at 9:40 AM

NFLX
IMPV
C

Analysts are weighing in on bank stock Citigroup Inc (NYSE:C), cybersecurity specialist Imperva Inc (NYSE:IMPV), and streaming content provider Netflix, Inc. (NASDAQ:NFLX). Here's a quick roundup of today's bearish brokerage notes on C, IMPV, and NFLX.

C is up 2.4% at $43.31, shrugging off a price-target cut to $50 from $54 at Bernstein. Year-to-date, however, the stock has stumbled more than 16%. On the fundamental front, Citigroup Inc said it will shutter a number of Venezuelan accounts following a risk management review, while the company's earnings are due out Friday morning. Shifting to sentiment, call buying has been all the rage in options land lately, while more than two-thirds of covering analysts rate C a "buy" or better -- with not a single "sell" rating to be found. An unwinding of this unwarranted optimism could create headwinds for the bank stock.

After a fast start to the week, IMPV has given back a portion of Monday's huge M&A-related gains. Out of the gate, the shares have surrendered 4.3% at $46.07, as the firm's weaker-than-expected current-quarter estimates sparked a round of negative analyst attention. For starters, Deutsche Bank lowered its opinion on Imperva Inc to "hold" from "buy," and cut its price target to $43 from $45. At least four other brokerages also reduced their target prices on the stock. Bullish options traders could be feeling the heat. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), speculators have bought to open more than eight IMPV calls for every put over the last four weeks.

Ahead of NFLX earnings next Monday night, Cowen trimmed its price target on the stock to $130 from $135. It's hard to fault the brokerage firm. Netflix, Inc. is down 0.3% today at $94.41, and has surrendered nearly 17% of its value on a year-to-date basis. More negative analyst attention could be headed NFLX's way, too. Despite the stock badly underperforming the broader market, 16 of 27 brokerage firms maintain "buy" or better assessments. A potential round of downgrades -- or even another bearish initiation -- could exacerbate losses.

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