O'Reilly Automotive Stock Slammed By Analysts; Chevron Cut to 'Underperform'

Analysts cut their price targets after O'Reilly Automotive's lackluster comparable-store sales

Jul 6, 2017 at 9:46 AM
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Analysts are weighing in on blue-chip oil stock Chevron Corporation (NYSE:CVX), dental and veterinary specialist Patterson Companies, Inc. (NASDAQ:PDCO), and auto parts supplier O'Reilly Automotive Inc (NASDAQ:ORLY). Here's a quick roundup of today's bearish brokerage notes on shares of CVX, PDCO, and ORLY. 

RBC Downgrades Chevron Stock to 'Underperform'

Analysts at RBC downgraded Chevron stock to "underperform" from "sector perform," and cut their price target to $100 from $112 -- a discount to CVX's close of $104.62 on Wednesday. At last check, CVX stock is down 0.1% at $104.50. While the Dow stock has recently attempted a rebound with crude oil prices, rally attempts have stalled in the face of CVX's 80-day and 200-day moving averages. Chevron shares have been in a channel of lower highs and lows since late 2016, and have given up more than 11% year-to-date.

Should the blue chip continue to struggle on the charts, more negative analyst attention could ensue. Currently, 11 out of 17 analysts maintain "buy" or better ratings on CVX stock, leaving the door open for potential downgrades to exacerbate the shares' slide.

PDCO Stock Slapped With 'Sell' Rating

Patterson Companies stock has rallied roughly 30% since its three-year low of $36.46 in November. Nevertheless, Stifel today downgraded PDCO stock to "sell" from "hold," sending the shares 4.9% lower to trade at $45.10. Most analysts are already in Patterson's bearish camp. Specifically, just three of 11 brokerage firms consider PDCO stock worthy of a "buy" or better rating. Likewise, short sellers are circling, with more than 13% of the stock's float dedicated to short interest. At PDCO's average daily trading volume, it would take more than eight sessions to buy back all of these bearish bets.

O'Reilly Automotive Stock Suffers After Same-Store Sales

No fewer than four brokerage firms cut their price targets on O'Reilly Automotive stock, and a pair of brokerage firms downgraded the shares, a day after the company issued weaker-than-expected same-store sales. Specifically, Morgan Stanley downgraded ORLY stock to "equal weight" from "overweight," and slashed its price target to $200 from $290, while Credit Suisse cut ORLY to "neutral" from "outperform" and reduced its price target to $195 from $262. On the flip side, Goldman Sachs raised its position on O'Reilly stock to "neutral" from "sell."

ORLY stock yesterday gapped notably lower on the sales miss, hitting a two-year low of $173.89. The shares are down another 0.1% this morning to trade at $178.61, bringing their year-to-date loss to more than 35%. More negative analyst attention could be on the way for O'Reilly Automotive shares. Of the 27 analysts following the stock, more than half maintain a "buy" or better opinion.


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