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Stock Downgrades: DreamWorks Awakes to Monday Morning Nightmare

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

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Movie studio DreamWorks Animation Skg Inc (NASDAQ:DWA) today gets downgraded by Bank of America Merrill Lynch. Its media and entertainment analysts wrote in a note that, "We anticipate a difficult 1Q14 for DWA [amid] Mr. Peabody and Sherman underperformance."
 
Last week was a difficult one for Wall Street, with an unloved Amazon (NASDAQ:AMZN) sliding 6.5%. Even as the company turned into a redistributionist Robin Hood, its best seller is a 700-page tome by a French economist raging against income inequality. The book thus follows in the footsteps of Go the F-- to Sleep as a sleeper hit on Amazon. (To more easily cure insomnia, just invest in the Dow (INDEXDJX:.DJI) on a day it did exactly nothing.) Some stocks did buck the desultory action. Orthopedic outfit Zimmer (NYSE:ZMH) jumped 11%, proving that the current cannabis craze now apparently even encompasses (artificial) joints.
 
Today in economics, March pending home sales are expected to tick up from February's pace at 10:00 a.m. Eastern. On the corporate front, another full week for first-quarter earnings announcements kicks off with the endlessly contentious Herbalife (NYSE:HLF) releasing results after the closing bell.

Now let's look at this morning's rating reductions, an eclectic bunch that features a favorite of William Ackman, the brewer of Guinness, and headline equity DreamWorks Animation.

Air Products (NYSE:APD): The chemical company, which billionaire activist investor Bill Ackman took a 9.8% stake in last summer, is slashed to Underweight from Neutral at Atlantic Equities.
 
Allergan (NYSE:AGN): The Botox owner, another Ackman favorite, was an analyst darling only a few days ago. This morning, however, Stifel reduces its rating to Hold from Buy after last week's 25.56% stock price surge left shares richly valued.
 
BCE Inc (NYSE:BCE): RBC Capital Markets moves the telecom services stock to Perform from Outperform and also trims its price target by $1 to $47. It would wait for a more compelling entry point before adding to positions.
 
CenturyLink (NYSE:CTL): Shares get downgraded to Perform from Outperform by BMO Capital Markets.
 
Clean Harbors (NYSE:CLH): Raymond James reduces its rating to Outperform from Strong Buy.
 
Diageo (NYSE:DEO): The owner of Guinness and Johnnie Walker gets downgraded to Neutral from Outperform at Credit Suisse.
 
DreamWorks Animation: Steven Spielberg's brainchild gets moved to Underperform from Neutral by Bank of America Merrill. The target price is also taken lower, to $22.
 
FLIR Systems (NASDAQ:FLIR): The tech name is now Fair Value from Buy at CRT Capital.
 
Mattress Firm Holding (NASDAQ:MFRM): KeyBanc moves MFRM to Hold from Buy.
 
Panera Bread (NASDAQ:PNRA): Shares are lowered to Underperform from Neutral at Longbow.
 
USG Corp (NYSE:USG): The building products powerhouse gets cut to Equal Weight from Overweight by Barclays, which also reduces its price objective by $6 to $31.
 
Wesco Aircraft (NYSE:WAIR): JPMorgan downgrades the stock to Neutral from Overweight.

Also see:

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No positions in stocks mentioned.
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