One equity is set for its worst day ever on a Huawei-related downgrade
Technology and chip stocks are suffering a steep sell-off this afternoon, sending markets deep into the red. Three names also making noise today are electronics name Keysight Technologies Inc (NYSE:KEYS), car manufacturer Ford Motor Company (NYSE:F), and video game retailer GameStop Corp (NYSE:GME). Below, we will dive into what is moving the shares of KEYS, F, and GME.
Keysight Stock Eyes Worst Day Ever
Keysight Technologies stock has been sucked into the Huawei headwinds today, with Baird reportedly shoveling out a downgrade to "neutral" from "outperform" on the electronics maker, alongside a price-target cut to $82 from $90. The analyst said the potential losses from Huawei business could weigh on Keysight's growth rate. In response, KEYS was last seen down 10% at $74.04 -- set for its worst session ever.
Today's downgrade is a rare occurrence for the security. As of last night's close, all five covering brokerage firms carried "strong buy" ratings. A price-target cut may have been overdue, however, with KEYS' average 12-month price target of $96.33 standing at a 30% premium to current levels.
Ford Motor Signals Next Step in Restructuring Effort
Ford Motor stock is hovering just around breakeven this afternoon, last seen trading at $10.26, as investors digest the company's plans to cut 7,000 salaried jobs -- or about 10% of its global workforce -- as a part of its restructuring effort. All but about 2,300 pink slips will be generated overseas, with the cuts coming by August. F stock has already added more than 34% year-to-date, and since an April bull gap has been consolidating its gains atop the $10 level.
Now looks to be an attractive time to speculate on Ford stock with near-term options. F's Schaeffer's Volatility Index (SVI) of 23% registers in just the 16th percentile of its annual range, meaning short-term options are pricing in relatively modest volatility expectations for the shares.
GameStop Stock Sinks on Credit Suisse Critique
Shares of GameStop stock are down 6.4% at $8.06, after Credit Suisse cut GME's price target to $7 from $10 -- a discount to current levels -- while also reiterating an "underperform" rating. The analyst said the company's loyalty drivers will remain under pressure, and waxed pessimistic on the video game concern's efforts to improve profitability. Earlier today, GME marked a 14-year low of $7.98, bringing its year-to-date deficit to 36%.
Such a bear note is not an abnormality for the video game retailer, however. Of the six analysts following GameStop stock, all but one carry a "hold" or worse rating. However, more price-target cuts could be in store; GME's average 12-month price target stands at $9.82 -- a 21.8% to current trading levels.