Yelp, Fossil Group, Acacia Downgraded

Lackluster earnings are weighing on YELP, FOSL, and ACIA shares

May 10, 2017 at 10:17 AM
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Analysts are weighing in on online review site Yelp Inc (NYSE:YELP), accessories maker Fossil Group Inc (NASDAQ:FOSL), and tech stock Acacia Communications, Inc. (NASDAQ:ACIA). Here's a quick roundup of today's bearish brokerage notes on shares of YELP, FOSL, and ACIA after earnings.

Analysts Hammer YELP Stock

YELP shares have plunged 20% to trade at $27.02 -- and are short-sale restricted (SSR) after the company's first-quarter revenue and current-quarter guidance fell short of analysts' estimates. Analysts were quick to weigh in, too, with RBC downgrading the stock to "sector perform" from "outperform," and joining no fewer than seven other brokerages in lowering its price target. Wells Fargo, however, upgraded Yelp stock to "market perform." YELP stock is now down more than 30% year-to-date, and well below recent support in the $32 region. YELP options traders are likely cheering today's post-earnings plunge, considering they had bought to open puts over calls at a quicker-than-usual clip in recent weeks. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), YELP's 10-day put/call volume ratio of 1.00 ranks in the 87th annual percentile.

FOSL Stock Sinks After Earnings

FOSL stock has plummeted 23% to trade at $13.94 -- fresh off an eight-year low of $13.65 -- after the watch maker's earnings and forecast came up short of Wall Street's projections. Pouring salt on the proverbial wound is a round of price-target cuts, including one from BofA-Merrill Lynch to $10, a level FOSL shares have not breached since 2002. Fossil stock is now staring at a 46% year-to-date deficit, a move welcomed by short sellers. Although Fossil shares are SSR today, short interest accounts for a whopping 26.6% of the retail stock's available float, or 12.5 times the average daily pace of trading.

ACIA Stock Slapped With Price-Target Cuts After Earnings

B. Riley and BofA-Merrill Lynch lowered their respective price targets on ACIA shares to $47 and $58, after the company offered up dismal second-quarter guidance. Against this backdrop, Acacia stock is trading down 9% at $44.06, and is SSR. This is just more of the same for the security, which has shed nearly 29% in 2017. And while short sellers control more than 65% of ACIA stock's float, not a single analyst has issued a "sell" rating toward the shares. A round of downgrades could create even more pressure for Acacia shares in the near term.


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