The Tech Stock at Risk for Downgrades

Chico's stock is heavily shorted, while most analysts call Finisar a strong buy

by Karee Venema

Published on Aug 31, 2017 at 9:15 AM
Updated on Jun 24, 2020 at 10:16 AM

Analysts are weighing in on Chinese travel stock Ctrip.Com International Ltd (ADR) (NASDAQ:CTRP), fiber optics specialist Finisar Corporation (NASDAQ:FNSR), and retailer Chico's FAS, Inc. (NYSE:CHS). Here's a quick roundup of today's bearish brokerage notes on shares of CTRP, FNSR, and CHS.

Daiwa Downgrades CTRP Stock After Earnings

Ctrip stock is down 5% in electronic trading, after the company's second-quarter earnings report was met with a downgrade to "outperform" from "buy" at Daiwa Capital Markets, with the brokerage firm citing uncertainty surrounding cross-sale revenue in the latter half of the year. A price-target cut to $58 from $65 at Raymond James is only adding to the bearish bias, though this still sits well above last night's close at $52.72.

More broadly, the stock pulled back after notching a record high of $60.65 on July 27, but ricocheted off its 200-day moving average -- a trendline that served as a ceiling back in January. Some options traders were betting on a bigger bounce from here, with the September 55 call seeing the notable volume in the last 10 days, and data from the major options exchanges confirming buy-to-open activity here.

Analysts are Surprisingly Upbeat Toward FNSR Stock

Ahead of next Tuesday's annual shareholders meeting, Finisar saw its price target lowered to $33 from $37 at Raymond James. FNSR shares are down 1.9% ahead of the open, after closing last night at $25.08. It's been a tough year for the tech stock, which is down 17.2% in 2017. What's more, the stock's 200-day moving average put a quick halt to rally attempts in June and July. With all 11 covering analysts still maintaining a "strong buy" rating, more bearish brokerage notes could be on the horizon.

More Good News for CHS Shorts

Yesterday morning's earnings miss earned Chico's a round of negative analyst notes overnight. No fewer than five brokerages lowered their price targets on the stock, including Telsey Advisory to $9 from $10. After closing down 4% yesterday at $7.52 -- and hitting a new eight-year low of $6.96 -- Chico's shares are down 1.5% in pre-market trading.

And with the security down almost 48% year-to-date, short sellers have been on the winning side of this trade. Despite being short-sale restricted yesterday, short interest jumped 17.5% in the two most recent reporting periods to 21.7 million shares -- roughly 18% of CHS stock's available float.

A Schaeffer's 39th Anniversary Exclusive!

8 Top Stock Picks for 2020

Access your FREE insider report before it's too late!


  
 
 

Partnercenter