Earnings Send Chicago Bridge & Iron Stock Crashing; SBUX Under Pressure Again

Starbucks stock is pointed lower once again

Aug 10, 2017 at 9:16 AM
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Analysts are weighing in on coffee stock Starbucks Corporation (NASDAQ:SBUX), cancer specialist Puma Biotechnology Inc (NASDAQ:PBYI), and construction concern Chicago Bridge & Iron Company N.V. (NYSE:CBI). Here's a quick roundup of today's bearish brokerage notes on shares of SBUX, PBYI, and CBI.

Bearish Analyst Attention Could Pressure Starbucks Stock

Back on June 5, Starbucks stock broke out to a record high of $64.87, but has since dropped more than 17% to close yesterday at $53.74 -- its lowest settlement since Nov. 10. A disappointing quarterly forecast late last month kicked off the shares' recent descent, and this weakness prompted Citigroup to cut its price target to $65 from $69 this morning. As such, SBUX stock is pointed 0.4% lower in pre-market trading. 

On a closer look, the equity certainly looks vulnerable to additional bearish analyst attention in the future. First of all, 16 of 21 brokerage firms say to buy Starbucks shares, with zero "sell" recommendations on the books. And SBUX has an average 12-month price target of $64.57 -- a 20% premium to current levels. This all leaves the door open for downgrades and/or price-target cuts to come through. In other news, the company just announced it'll offer new Pumpkin Spice Latte products in grocery stores. 

PBYI Stock Could Pull Back Further After Earnings

Puma Biotechnology stock is on pace to open in the red, after the company's second-quarter earnings report was followed by price-target cuts to $110 and $105 from Stifel and J.P. Morgan Securities, respectively. PBYI has been one of the hottest names across Wall Street this year. After entering 2017 trading near the $30 level, the shares surged to a peak of $98.85 on July 27, but have since pulled back to close yesterday at $79.50. This bearish price action could offer some relief to short sellers, who've been burned by the stock. Specifically, more than 27% of Puma Biotechnology's float is dedicated to short interest, equating to almost 10 times the equity's average daily trading volume. 

Earnings Report Crushes Chicago Bridge & Iron

Chicago Bridge & Iron Company last night reported shockingly bad second-quarter results,while also suspending its dividend, sending the construction stock spiraling more than 20% in electronic trading. In response, Citigroup dropped its price target to $18 from $20. If these pre-market losses materialize, it'd put CBI shares near their roughly eight-year low of $12.92 from June 21, after they settled yesterday at $16.33. 

Apparently, some savvy investors saw the writing on the wall for this stock. Specifically, short interest has been skyrocketing over the past year, including a nearly 77% jump over the last two reporting periods. Short interest on Chicago Bridge & Iron stock is now at the highest point in at least 15 years, with 19.4 million shares sold short. 

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