Analyst Downgrades: Gap Inc, Spirit Airlines Incorporated, and First Solar, Inc.

Analysts downwardly revised their ratings and price targets on Gap Inc (NYSE:GPS), Spirit Airlines Incorporated (NASDAQ:SAVE), and First Solar, Inc. (NASDAQ:FSLR)

Nov 18, 2016 at 10:01 AM
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Analysts are weighing in on retail stock Gap Inc (NYSE:GPS), discount airline Spirit Airlines Incorporated (NASDAQ:SAVE), and solar stock First Solar, Inc. (NASDAQ:FSLR). Here's a quick roundup of today's bearish brokerage notes on GPS, SAVE, and FSLR.

  • GPS is sliding due to disappointing quarterly results, with the company saying, "We understand the fact that traffic is likely to continue to be challenging as we look forward." While at least eight brokerage firms actually raised their price targets, Citigroup weighed in with a downgrade to "sell" from "neutral." Gap Inc remains higher on a year-over-year basis, despite today's 9.4% drop to trade at $27.82, but many across Wall Street are betting against the stock. For instance, almost two weeks' worth of buying power is controlled by short sellers, going by average daily volumes. 

  • Citigroup has downgraded SAVE to "neutral" from "buy," after transferring coverage to a new analyst. The stock was last seen 0.7% lower at $53.48 though it has outperformed the S&P 500 Index (SPX) by 34.5 percentage points during the past three months. In the options pits, Spirit Airlines Incorporated traders have been almost entirely focused on call buying -- albeit amid low absolute volumes. During the last two weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock has accumulated a call/put volume ratio of 9.69, which outranks four-fifths of the past year's readings. 
  • FSLR sold off yesterday after announcing an ugly outlook, but UBS thinks the situation is even worse than initially believed. More specifically, the brokerage firm said it sees "cash burn likely to continue into 2018" for First Solar, Inc., and downgraded its rating to "sell" from "neutral." At last check, the stock was down another 4% at $29.90, bringing its year-to-date deficit to 54.7%. More downgrades could be in the works, too, since five brokerage firms still rate the struggling stock a "strong buy." 
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