Soros Abandons Snap Stock; MTSI Spirals After Earnings, Downgrade

Earnings and a round of bearish brokerage notes have MTSI shares at a new 52-week low

Nov 15, 2017 at 9:48 AM
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Analysts are weighing in on Snapchat parent Snap Inc (NYSE:SNAP), semiconductor stock MACOM Technology Solutions Holdings Inc (NASDAQ:MTSI), and retailer Bed Bath & Beyond Inc. (NASDAQ:BBBY). Here's a quick roundup of today's bearish brokerage notes on SNAP, MTSI, and BBBY stocks.

Soros Dissolves SNAP Stake

Soros Fund Management dissolved its entire stake in Snap in the third quarter. Meanwhile, JMP Securities this morning downgraded SNAP stock to "market perform" from "outperform," citing the potential impact on user growth from a looming Snapchat app redesign.

In response, Snap shares are down 2.9% to trade at $12.22 -- edging closer and closer to their Aug. 14 record low of $11.28. Longer term, the stock has shed more than 36% over the past six months, with a short-lived October rally quickly halted by the recently formed 120-day moving average.

Amid this weakness, the stock remains heavily shorted. While short interest has dropped slightly from its Oct. 15 record high of 121.13 million shares, nearly 10% of SNAP's float is sold short. The stock could suffer from additional selling pressure, though, with shorts firmly in control of Snap.

MTSI Eyes New Lows After Weak Guidance

MACOM Technology reported lackluster quarterly sales and forecast current-quarter profit below expectations. The dreary results sparked a flood of bearish brokerage notes, including a downgrade to "underperform" from "neutral" at BofA-Merrill Lynch, which slashed its price target by $15 to $30.

Against this backdrop, MTSI stock is down 12.6% at $32, after tagging a new annual low of $31.74 out of the gate. Heading into today's trading, the shares were already down almost 21% year-to-date -- due largely to a massive post-earnings bear gap in early August -- and skimming 52-week-low territory.

Speaking to the stock's weakness is its inability to capitalize on a recent round of short covering. Specifically, after hitting a record high 9.94 million shares in mid-September, short interest fell nearly 17% through the Nov. 1 reporting period -- a time frame in which the shares shed almost 10%.

Bed Bath & Beyond Drops on Bearish KeyBanc Outlook

KeyBanc Capital slashed its price target on Bed Bath & Beyond stock to $17 from $21, and cut its 2017 and 2018 earnings-per-share estimates, citing competitive and structural headwinds. As such, the retail shares are down 3.4% to trade at $19.50. This is just more of the same for BBBY, though, which was down 50.3% year-to-date at last night's close -- and hit a nine-year low of $19.07 on Nov. 7.

Nevertheless, BBBY options traders have been unusually optimistic in recent weeks. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 10-day call/put volume ratio ranks in the 100th annual percentile, indicating calls have been bought to open over puts at a faster-than-usual clip.

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