3 Stocks Dinged With Downgrades

Both AKAM and GMED fell to 12-month lows earlier today

Managing Editor
Jan 2, 2019 at 2:12 PM
facebook twitter linkedin


On the first trading day of 2019, stocks pared their sharp losses and turned higher at midday. Lumber manufacturer Louisiana-Pacific Corporation (NYSE:LPX), cloud concern Akamai Technologies, Inc. (NASDAQ:AKAM), and medical device maker Globus Medical Inc. (NASDAQ:GMED) are all lower on negative analyst attention. Below, we'll take a look at the news on shares of LPX, AKAM, and GMED.

Analyst: Macro Concerns for Louisiana-Pacific Stock

LPX shares were last seen down 5% at $21.10, after receiving a downgrade from BofA-Merrill Lynch to "neutral" from "buy," as well as a price-target cut to $24 from $29. The analyst in coverage urged caution due to U.S.-China trade tensions, as well as the typical sector slowdown around this time of year.

LPX stock earlier traded as low as $20.71, dangerously close to its Dec. 21 12-month low of $20.39. A drop today would snap a four-day winning streak, with the shares' 50-day moving average once more serving as stiff resistance, as it did back in late November/early December. 

As for broader sentiment on the lumber stock, three of five analysts still maintain "strong buy" ratings, and its consensus 12-month price target of $30.11 is a 42.5% premium to its current perch. Additional downgrades or price-target cuts could send LPX even lower.

Cowen Downgrade Sends AKAM to New Lows

Cowen downgraded Akamai Technologies stock to "market perform" from "outperform," while cutting its price target to $73 from $86, citing concerns over the company's revenue growth. At last check, AKAM was down 2.8% to trade at $59.36, and earlier fell to a new 12-month low of $57.53. The cloud stock is fresh off its worst month since May 2017, and has shed nearly 10% year-over-year.

Like Louisiana-Pacific, the analyst community remains mostly bullish. Of the 13 brokerages covering AKAM, eight rate it a "strong buy," with zero "sells" on the books. The stock's consensus 12-month price target, meanwhile, sits up at $83.33, just above its June 21 18-year high of $83.08. 

Morgan Stanley Note Exacerbates GMED Skid

Globus Medical stock is down 7.4% at $40.07, and earlier hit a 12-month low of $39.87. Fueling the drop is a downgrade to "equal weight" from "overweight" at Morgan Stanley, which also trimmed its price target to $49 from $64. GMED nabbed a record high of $57.83 as recently as Nov. 8, but since then has shed 30%, guided lower by its descending 10-day moving average.

For Globus Medical, analysts are much more evenly split. Nearly half rate GMED a "buy" or better. However, its consensus 12-month price target of $59.45 is a 48% premium to its current perch.

 

Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

 
Schaeffer's Daily Bulletin Offer
 


 


 
Special Offers from Schaeffer's Trading Partners