Again, these Sell ratings and their equivalents were based on outside analyst calls from Wall Street brokerage and research firms. Prices were as of mid-afternoon on Friday rather than the closing price.
Orbitz Worldwide Inc. (NYSE: OWW) was already lagging travel site peers in its cautious rating of Neutral, but then Goldman Sachs went from cautious to just negative by downgrading Orbitz to Sell last Wednesday. Goldman Sachs even dropped the price target to $8.00, versus what had been a $14.20 price target before the downgrade. Orbitz fell to $8.13 from $8.95 on the call, and the stock was around $8.05 in late Friday trading.
Shutterfly Inc. (NASDAQ: SFLY) was downgraded to Underperform from Outperform and the target price was slashed to $39 from $57 (versus a prior $50.43 close) at Cowen and Co. This firm had been a long-term bull before jettisoning its bias last Tuesday. While an Underperform rating is the equivalent of a Sell rating by almost every mean, this had the sound of a “Strong Sell and Run for the Hills!” call. The consensus price target was closer to $57, and the prior lowest analyst price target was $47. Shutterfly shares were up on Friday, but they were still right around $46 in late trading.
Symantec Corp. (NASDAQ: SYMC) is now in an unforgiveable position — not doing well with Norton when data security remains a top national concern. Oh, and it fired its CEO. MKM Partners downgraded its rating to Sell from Buy on Friday after the disappointment, but the reality is that there were at least seven downgrades we saw, and even more firms than that lowered estimates and targets. This is a true disaster, and the stock hit a 52-week low that broke under $18 on Friday, even though the stock made a bit of a recovery from the morning lows.
Talisman Energy Inc. (NYSE: TLM) was started as Sector Underperform at CIBC World Markets on Wednesday. Having closed at $9.86 before the call, it has a 52-week range was only $9.73 to $13.38. Shares were down only about 1% on the news, but to start coverage at an Underperform right above the 52-week lows of any stock sure sounds like a Strong Sell rating from a firm that does not officially have “Sell” as a rating. Talisman shares were back above $10 in late-Friday trading — maybe CIBC had its charts upside down.
Walgreen Co. (NYSE: WAG) managed to stand up rather well after being downgraded to Sell from Hold at Cantor Fitzgerald on Friday. The main point was that the run-up in the shares was not justified. What stood out the most in this call was that the downside price target was put at $50, versus a prior closing price of $66.50. Shares were down only about 0.5% in trading late Friday, around $66.10.
Walter Energy Inc. (NYSE: WLT) was maintained as Underperform by Merrill Lynch Thursday in a call that was far worse than a reiteration is supposed to sound. Walter Energy’s price target drop was so bad that this would be counted as a “Screaming Sell” if such a rating existed. The target was cut to $2 from $8, after shares previously closed at $9.09. The loss estimates were basically doubled as well. Walter fell from more than $9 on the call to almost $7 before recovering. Shares were back up above $7.50 in late-Friday trading. Still, this was a 75% slash in the target price based on more and more poor coal industry pricing ahead.
WisdomTree Investments Inc. (NASDAQ: WETF) was downgraded to Sell from Neutral last Wednesday at Citigroup, after shares had nearly tripled from the bottom of 2013. This exchange traded fund had previously risen handily because of the hedged-Japan ETF during the rise of its quantitative easing. That trade has now played out. Citigroup said there is little room for error in its valuation of almost 40 times earnings. Shares fell from almost $14.25 to under $13.50 on the call, and shares were still closer to $13.30 in late-Friday trading.