Ferrari, Trivago Stocks Downgraded; Spirit Sinks With Airlines

Trivago stock is trading near its mid-December IPO price of $11

Managing Editor
Sep 7, 2017 at 10:11 AM
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Analysts are weighing in on car manufacturer Ferrari N.V. (NYSE:RACE), airline stock Spirit Airlines Incorporated (NASDAQ:SAVE), and travel site Trivago NV - ADR (NASDAQ:TRVG). Here's a quick roundup of today's bearish brokerage notes on shares of RACE, SAVE, and TRVG.

Morgan Stanley Downgrade Stalls Ferrari Stock

Ferrari shares are down 5.8% to trade at $110.06, after Morgan Stanley double downgraded the car stock to "underweight" from "overweight" -- citing "valuation concerns" and threats from rivals. RACE stock has been on fire over the past 12 months, up 121% year-over-year thanks to solid support from its 50-day moving average, and setting a new record high of $118.10 yesterday. However, considering the stock's 14-day Relative Strength Index (RSI) closed last night at 71 -- in "overbought" territory -- a short-term breather may have been in the cards.

Sector Weakness, Price-Target Cut Grounds Spirit Airlines

Spirit Airlines stock is down 1.4% to trade at $31.65, after Imperial Capital cut its price target to $32 from $42. This follows a string of negative analyst attention the security has received in recent weeks, and comes as the threat of Hurricane Irma drags the entire airline sector down. In fact, SAVE stock fell to a four-year low of $30.32 yesterday, and the shares have shed over 45% year-to-date. 

It's likely short sellers have had a hand in the equity's recent selloff, too. Short interest surged 40% in the two most recent reporting periods to 4.22 million shares -- the most since mid-December.

Lowered Guidance Leads to a Downgrade for Trivago Stock

Trivago stock is down 2.3% to trade at $12.21, after the company's dismal guidance on Wednesday prompted a downgrade to "neutral" from "buy" at BofA-Merrill Lynch this morning. In addition, the stock received three price-target cuts, including one to $13 from $18 at Cowen and Company. TRVG stock fell to a record low of $10.43 yesterday, breaching its $11 IPO price for just the third time since going public last December. With four analysts still maintaining a "buy" or better rating at last night's close, more downgrades could be on the horizon for the security.


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