Analyst Upgrades: Transocean LTD, Micron Technology, Inc., and Vale SA

Analysts upwardly revised their ratings and price targets on Transocean LTD (RIG), Micron Technology, Inc. (MU), and Vale SA (ADR) (VALE)

Dec 19, 2016 at 9:19 AM

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Analysts are weighing in on energy stock Transocean LTD (NYSE:RIG), chipmaker Micron Technology, Inc. (NASDAQ:MU), and mining firm Vale SA (ADR) (NYSE:VALE). Here's a quick roundup of today's bullish brokerage notes on RIG, MU, and VALE.

Evercore ISI reinstated coverage on RIG with an upbeat "buy" rating and $18 price target, in territory the shares have not seen since June 2015. As such, shares of Transocean LTD are set to open higher, and are already sitting on a 21.2% year-to-date lead, based on last Friday's close at $15.01. With the the stock just off a Dec. 12 annual high of $16.66, RIG could still stand to benefit from an unwinding of bearish attention among traders in and out of the options pits. Plus, 18 of 21 brokerages continue to rate the equity a "hold" or "strong sell."
MU is up 1.3% ahead of the bell, and could make a run at a fresh 12-month high, after J.P. Morgan Securities raised its price target on the stock to $25 from $20. The shares have been trending higher since May, and Friday hit an annual high of $21 before closing at $20.27 -- up 43.2% on the year. Options traders have been betting on more gains for the stock, too, with Micron Technology, Inc.'s quarterly results due out after Wednesday's close. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 10-week call/put volume ratio sits at a top-heavy 3.88 -- higher than 81% of the past year's readings.
VALE is 0.9% higher in electronic trading, after the company announced it will sell its fertilizer business to Mosaic Co (NYSE:MOS) for $2.5 billion in cash and stock. Additionally, Deutsche Bank increased its price target on Vale SA to $12 from $10.75 -- representing an expected move to territory not seen in more than two years. VALE has been an outstanding performer this year, tacking on more than 148% to trade at $8.17, and enjoying support from its rising 30-day moving average since September. However, options traders have largely been bracing for a pullback, and have purchased more than two VALE puts for each call over the past 10 sessions on the ISE, CBOE, and PHLX. Moreover, the resulting put/call volume ratio ranks in the elevated 84th annual percentile.

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