Analyst Upgrades: Delta Air Lines, Goldcorp, Yum! Brands

Analysts upwardly revised their ratings and price targets on Delta Air Lines, Inc. (DAL), Goldcorp Inc. (USA) (GG), and Yum! Brands, Inc. (YUM)

Jul 14, 2016 at 9:21 AM

Analysts are weighing in on aviation specialist Delta Air Lines, Inc. (NYSE:DAL), commodity stock Goldcorp Inc. (USA) (NYSE:GG), and Pizza Hut parent Yum! Brands, Inc. (NYSE:YUM). Here's a quick roundup of today's bullish brokerage notes on DAL, GG, and YUM.

DAL reported better-than-expected earnings, while vowing to reduce its flight capacity growth due to declining unit revenues -- earning a price-target hike to $52 from $51 at Credit Suisse. However, the company also warned that the "revenue environment remains challenging, with persistent headwinds from close-in domestic yields and geopolitical uncertainty." Ahead of the bell, Delta Air Lines, Inc. is pointed 0.9% higher, but at Wednesday's close of $39.56, was down 22% year-to-date. While today's analyst attention was bullish, the stock appears at risk of being downgraded. Seven of eight brokerage firms consider DAL a "buy" or better, with not a single "sell" opinion in sight.
Jefferies raised its price target on GG to $20, roughly in line with the stock's Wednesday settlement at $19.48. Nonetheless, the shares are down 2.8% pre-market after the Bank of England (BoE) stood pat on interest rates, pressuring gold futures. Longer term, Goldcorp Inc. has been a technical beast, rallying 68.5% year-to-date. However, options traders have been bracing for a pullback. GG's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 1.77 rests at an annual high. In other words, traders have bought to open puts over calls at an extreme rate in recent weeks.

YUM narrowly bested per-share earnings expectations, and lifted its full-year core operating profit growth guidance to at least 14%. Reacting to the news, Nomura and J.P. Morgan Securities raised their respective price targets to $96 and $97. Yum! Brands, Inc. closed yesterday at $85.74, and is pointed 4.1% higher in electronic trading -- suggesting the shares could make a run at a new annual high. Elsewhere, short-term options traders are very call-skewed right now, per YUM's Schaeffer's put/call open interest ratio (SOIR) of 0.51 -- which ranks in the low 34th percentile of its annual range.

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