Stock Downgrades: Dark Day in SolarCity

By Justin Sharon  MAR 07, 2013 9:23 AM

Wall Street ratings agencies set the tone for today's stock market.

 


This stealth equity market continues rising to dizzying heights, and sooner or later, the lay public may pay attention. When noted investment expert Richard Bernstein tells the New York Times (NYT), “We think this could be the biggest bull market of our careers,” it bears listening to. In March 2000, just as the Internet bubble was about to burst, he declared, “Attention Venture. Capitalists: Leave Silicon Valley for West Texas,” and that advice, on the cusp on a simultaneous tech collapse and energy boom, turned out to be priceless. 
 
An upgrade by Best Buy (BBY) analyst Daniel Binder sent that stock, already up 55% this year, 1.90% higher. “Binders full of women” alas proved less profitable for Mitt Romney. Staples (SPLS), the firm he helped to establish, slumped 7.15%.
 
Apple Inc. (AAPL) lost 1.27% on a ratings reduction. Rival BlackBerry (BBRY) fared better, jumping 6.12% after strong sales of its BlackBerry 10 continue to raise eyebrows, including, apparently, those of its CEO.
 
Today in economics, analysts expect a contraction in January consumer credit at 3:00 p.m. Eastern. On the earnings front, Adidas (PINK:ADDYY), Ciena (CIEN), Finisar (FNSR), H&R Block (HRB), John Wiley & Sons (JW-A), Kroger (KR), Nationstar Mortgage (NSM), Navistar (NAV), Pandora Media (P), Quiksilver (ZQK), Skullcandy (SKUL), Smithfield Foods (SFD), Telecom Italia (TI), and Workday (WDAY) are all due to report results.
 
Allergan (AGN): The Botox maker is now Neutral from Buy at Buckingham.
 
American Water Works (AWK): Citing its steep valuation, Citigroup downgrades the utility to Neutral from Buy with an updated price objective of $42.
 
Aviva (AV): Morgan Stanley pulls the stock from its list of Best Ideas.
 
Badger Meter (BMI): Janney Capital cuts the technical instrument company to Neutral from Buy due to valuation concerns.
 
Big Lots (BIG): Raymond James moves the stock, which surged some 6.14% on Wednesday, to Underperform from Market Perform. (Note that shares also scored an upgrade this morning.)
 
CommonWealth REIT (CWH): A recent dilutive equity offering is among the reasons behind Stifel Nicolauss slashing the stock to Sell from Hold.
 
Daimler (PINK:DDAIF): The luxury automaker whose brands include Mercedes-Benz is now Neutral from Buy at Citi.
 
DaVita HealthCare Partners (DVA): Deutsche Bank downgrades DVA to Hold from Buy with a $130 price target.
 
DFC Global (DLLR): The stock is now Neutral from Buy at Nomura.
 
DigitalGlobe (DGI): DGI gets downgraded to Hold from Buy at Benchmark, which sees this as a transitional year with an overall lack of stock price movers as it digests an acquisition. Its price objective is $27.
 
Fresenius Medical Care (FMS): Troubled by constrained near-term growth amid industry headwinds, RBC Capital cuts the stock to Sector Perform from Outperform with a $36 target.
 
Lincoln Educational Services (LINC): BMO Capital lowers LINC to Underperform from Market Perform with a $4 objective on account of its weak capacity utilization.
 
Quicksilver Resources (KWK): Shares are cut to Hold from Buy at MLV & Co. amid a delay in de-leveraging its balance sheet.
 
SandRidge Energy (SD): Saying that shares are significantly overvalued, BMO Capital moves the stock to Market Perform from Outperform and also trims its target by $2 to $4.
 
Sociedad Química y Minera (SQM): Miller Tabak moves the Chilean chemical company to Hold from Buy with an objective of $60 as iodine margins have peaked quicker than projected.
 
SolarCity (NASDAQ:SCTY): The stock, imploding some 8.35% ahead of the open, is now Hold from Buy at Needham due to a lack of upside to its deployment target.
 
United Natural Foods (UNFI): Argus lowers its rating to Hold from Buy.
 
Vitacost.com (VITC): Shares are slashed to Sell from Neutral at Roth Capital due to increased competition and a margin squeeze among other issues. The new target price is $6.00, down from $5.50.
 
William Morrison Supermarkets (PINK:MRWSY): The British grocery giant gets downgraded to Underweight from Neutral at HSBC Securities.

(See also: New Stock Coverage: Make Sure You Are on Angie’s List and Stock Upgrades: Fine Time to Buy Time Warner.)
No positions in stocks mentioned.

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