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Stock Downgrades: Red Lobster Owner Darden Restaurants Can't Claw Its Way Back


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

Darden Restaurants (NYSE:DRI), owner of Olive Garden, LongHorn Steakhouse, and Red Lobster, saw its stock fall 3.92% on Friday even as the overall market reached records. The company reported fourth-quarter results that were dragged down by a double whammy of higher costs and lower profit. Today an equity analyst, while keeping the overall investment assessment intact, cuts Darden's price target due to lower cash flow and cloudy long-term earnings prospects.
Janet Yellen was merely the world's third most incredible Chair last week. Top honor went to those wheelchair-bound Brazilian fútbol fans who were miraculously able to stand up and cheer. And La-Z-Boy (NYSE:LZB), which imploded 8.05% one day only to get off the couch in spectacular fashion the next, also deserves an honorable mention. Yet the Fed head's market-friendly comments still sent the Dow (INDEXDJX:.DJI) and S&P 500 (INDEXSP:.INX) to records. Starbucks (NASDAQ:SBUXgot into a higher education game that is really best left to professionals. (Actually, maybe not, what with Corinthian Colleges (NASDAQ:COCO) cratering to 33 cents amid real fears over its future.) SolarCity (NASDAQ:SCTY), up 31.55% on the week, enjoyed the summer solstice and Ray Ban owner Luxottica (NYSE:LUX) -- our World Cup pick -- finished up 3.54% on Friday at a historic high. This as beleaguered Bill Gross took to wearing shades indoors and RadioShack (NYSE:RSH), whose Super Bowl ad honored The Future's So Bright I Gotta Wear Shades decade, dipped below a dollar for the first time ever.

Today in economics, May existing home sales are expected to improve from the prior month's pace at 10:00 a.m. EDT. On the earnings front, Micron Technology (NYSE:MU) and Sonic Corp (NASDAQ:SONC) each release results.
Now let's look at this morning's analyst actions, an eclectic bunch that features semiconductor and handbag stocks plus headline equity Darden Restaurants.

Advanced Micro Devices (NYSE:AMD): Shares are slipping before the bell after getting downgraded to Underperform from Sector Perform at Pacific Crest.
BE Aerospace (NASDAQ:BEAV): Goldman Sachs pulls the stock from its list of Conviction Buys.
Casella Waste Systems (NASDAQ:CWST): CWST gets cut to Hold from Buy with Wunderlich, which cites sluggish free cash flow. Its price objective, previously $7, is now $6.
Coach (NYSE:COH): The stock, which tumbled 12% last week, is now Underperform from Neutral with Wedbush.
Darden Restaurants: RBC Capital Markets keeps its overall opinion intact on today's headline equity, but does take its target price down by $5 to $50.
Helmerich & Payne (NYSE:HP): Shares are moved to Market Perform from Outperform with a $120 target at FBR Capital.
Hercules Offshore (NASDAQ:HERO): Goldman Sachs slashes the stock to Sell from Neutral.
Nordstrom (NYSE:JWN): Due to valuation issues, Goldman reduces the luxury retailer to Neutral from Buy.
NVIDIA (NASDAQ:NVDA): Shares are 1.74% lower ahead of the open after getting downgraded to Underperform from Sector Perform at Pacific Crest.
Owens Corning (NYSE:OC): Longbow lowers the stock, which slumped 6.03% on Friday, to Neutral from Buy.
SunPower (NASDAQ:SPWR): Shares get downgraded to Hold from Buy at Brean Capital, which cites a steep valuation after last week's stellar run up in the solar sector.
Teradata (NYSE:TDC): JMP Securities takes the tech name to Perform from Outperform.
Also see:

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