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VIDEOUpgrades and Downgrades: Collective Brands Kicked To The Curb
By
Justin Sharon
Sep 03, 2010 8:30 am
Wall Street ratings agencies set the tone for today's stock market.
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Payless ShoeSource parent Collective Brands (PSS) could certainly use some celebrity endorsing, always assuming Imelda is available, after imploding 9.08% on an earnings miss. How Ms. Marcos must have marveled at the impressive 18.91% increase in Harry Winston Diamond (HWD) as its first profit in 18 months beat the Street -- the street in its case being Rodeo Drive, where it owns an especially high grossing store. Yesterday of all days this made them the toast of Beverley Hills. Turning to another kind of carrots, Bugs Bunny’s favorite vegetable is about to begin marketing itself as a junk food. With Burger King Holdings (BKC) up 25.08% on a $3.26 billion buyout, there’s clearly money in the category. And while The Ancient Mariner may have been pure poetry, yesterday history repeated rather than rhymed for Mariner Energy (ME). Today in 10:00AM Eastern economics, a fall is forecast for the August ISM Non-Manufacturing Index. On the corporate front Campbell Soup (CBP) is already out with earnings this morning.
Initiations
W.R. Grace (GRA): The stock gets covered with a Buy at KeyBanc Capital, which assigns it a price objective of $36. They view the company as an emerging high quality specialty chemical company with good growth potential.
Navios Maritime Acquisition (NNA): NNA is a new Neutral at JP Morgan.
Vistaprint (VPRT): Kaufman Brothers begins Buy rated research on Vistaprint and sets a $50 price target as they view it as a strong value proposition with proprietary technology. The firm further feels shares are inexpensive at 13x calendar 2011 PF EPS of $2.49.
Upgrades
The Buckle (BKE): BKE gets a Hold-from-Underweight boost at KeyBanc Capital. Though the broker believes this is a multi-quarter margin compression cycle, they say the likelihood of a special dividend and high short interest in Buckle lead them be more constructive on the stock.
James Hardie NV (JHX): Building products maker James Hardie NV is raised to Neutral from Reduce at Nomura.
Downgrades
McAfee (MFE): MFE is cut to Neutral from Outperform at Cowen. See also McAfee-Intel Deal a Game Changer for Endpoint Security Market.
Collective Brands (PSS): Payless ShoeSource operator Collective Brands is now Neutral from Positive at Susquehanna with a $23 target price after yesterday’s steep sell off in their shares.
Burger King (BKC): With the stock no longer trading on fundamentals following its purchase by a private equity firm, Burger King gets its rating reduced at Piper Jaffray (Neutral from Overweight) and Deutsche Bank, which downgrades it 180 degrees (Sell from Buy). Also read How Burger King Lost Its Crown.
Compania Cervecerias Unidas (CCU): Deutsche Bank also lowers its recommendation on Chilean beer firm Compania Cervecerias Unidas to Hold from Buy.
Mitel (MITL): Canadian technology company Mitel is moved to Neutral from Overweight by both JP Morgan and Piper Jaffray.
American Eagle (AEO): The retailer is lowered to Hold from Buy at Lazard.
No positions in stocks mentioned.
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