Analyst Downgrades: Bed Bath & Beyond Inc., Viacom, Inc., and CBS Corporation

Analysts downwardly revised their ratings and price targets on Bed Bath & Beyond Inc. (NASDAQ:BBBY), Viacom, Inc. (NASDAQ:VIAB), and CBS Corporation (NYSE:CBS)

Sep 22, 2016 at 9:52 AM
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Analysts are weighing in on retail stock Bed Bath & Beyond Inc. (NASDAQ:BBBY), as well as entertainment names Viacom, Inc. (NASDAQ:VIAB) and CBS Corporation (NYSE:CBS). Here's a quick roundup of today's bearish brokerage notes on BBBY, VIAB, and CBS.

  • BBBY's second-quarter earnings miss was met with backlash from the brokerage bunch. No fewer than five analysts lowered their price targets on BBBY, including BofA-Merrill Lynch, which cut its target price by $1 to $36. It's been a rocky year for the stock, which has shed nearly 27% in the past 52 weeks, but added 2% this morning to trade at $43.96. Options traders, it seems, were bracing for even more post-earnings losses, too. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Bed Bath & Beyond Inc.'s 10-day put/call volume ratio of 1.08 ranks in the 69th annual percentile, meaning puts have been bought to open over calls at a faster-than-usual clip.
  • VIAB has been in analysts' crosshairs of late, and most recently, the stock was hit with no fewer than five price-target cuts. BMO set the lowest bar, cutting its price target to $35 from $40. This latest round of negative analyst attention comes in the wake of Wednesday's C-suite shake-up, with Viacom, Inc. announcing the departure of interim CEO Thomas Dooley. Even so, VIAB is up 0.5% at $36.02, paring its year-over-year deficit to 12.5%. Most analysts are already lukewarm on the stock, with the majority maintaining a tepid "hold" recommendation. However, 13 brokerages still maintain a "buy" or better rating on VIAB, meaning futures downgrades are a distinct possibility.
  • Telsey Advisory Group downgraded CBS to "market perform" from "outperform" and lowered its price target to $57 from $67, saying it believes the chances are high that CBS Corporation will combine with VIAB. Nevertheless, shares of CBS up 0.1% at $50.11, after finding a familiar foothold atop the round $50 mark. Longer term, CBS has turned in a solid performance, tacking on 20% over the past 12 months. On the sentiment front, short-term options traders are more put-heavy than usual. CBS' Schaeffer's put/call open interest ratio (SOIR) of 0.97 ranks higher than 87% of all comparable readings taken in the past year.
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