Analyst Downgrades: FireEye Inc, Sierra Wireless, Inc., and Universal Display Corporation

Analysts downwardly revised their ratings and price targets on FireEye Inc (FEYE), Sierra Wireless, Inc. (USA) (SWIR), and Universal Display Corporation (OLED)

by Alex Eppstein

Published on Aug 5, 2016 at 10:05 AM

Analysts are weighing in on cybersecurity stock FireEye Inc (NASDAQ:FEYE), telecom issue Sierra Wireless, Inc. (USA) (NASDAQ:SWIR), and tech firm Universal Display Corporation (NASDAQ:OLED). Here's a quick roundup of today's bearish brokerage notes on FEYE, SWIR, and OLED.

  • FEYE laid an egg in the earnings confessional last night, cutting its forecasts and announcing a round of layoffs. Analysts have been quick to pounce, too, with Citigroup, William Blair, and J.P. Morgan Securities lowering their assessments to the equivalent of a "hold" -- with the latter among at least 10 brokerage firms cutting their price targets. Out of the gate, FireEye Inc is down 13.3% at $14.5 -- earlier breaching $14 for the first time since May -- and on the short-sale restricted (SSR) list. Speaking of short selling, 14.5% of FEYE's float is already dedicated to short interest, representing five days of trading activity, at the stock's typical volumes.
  • A weak forecast and "signs of softer short-term demand" have overshadowed stronger-than-expected earnings at SWIR, sending the stock down 16% at $14.44 -- and onto the SSR list. The shares have now plunged into negative year-to-date territory, while analysts are lowering their expectations. Specifically, CIBC downgraded its opinion to "sector underperformer" from "sector performer," and was one of at least five analysts to lower its price target. This is a good thing for Sierra Wireless, Inc. bears, who have been more active than usual in the options pits. Specifically, the stock's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.35 ranks in the high 85th percentile of its annual range.
  • OLED is also SSR, after diving 11.4% to $62.25 on an earnings miss. Adding insult to injury, Needham lowered its opinion to "hold" from "buy," while Goldman Sachs trimmed its price target to $77 from $79. As such, the stock is on track for its lowest daily finish since late May. This could leave short-term options traders nervous. Universal Display Corporation's Schaeffer's put/call open interest ratio (SOIR) checks in at 0.27 -- with calls nearly quadrupling puts among options expiring in the next three months. What's more, OLED's SOIR ranks in the call-skewed 19th percentile of its annual range.
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