Analyst: 'Sell' Advance Auto Parts Stock; Bernstein Bearish On KORS, UAA

By Patrick Martin / September 12, 2017 / www.schaeffersresearch.com / Article Link

Analysts are weighing in on auto stock Advance Auto Parts, Inc. (NYSE:AAP), as well as retailers Michael Kors Holdings Ltd (NYSE:KORS) and Under Armour Inc (NYSE:UAA). Here's a quick roundup of today's bearish brokerage notes on shares of AAP, KORS, and UAA.

Citigroup Downgrades AAP Stock to 'Sell'

The bad news keeps coming for Advance Auto Parts stock, which is currently down 2.4% to trade at $92.11, after receiving a downgrade from Citigroup to "sell" from "neutral." In addition, AAP saw its price target slashed to $82 from $99 -- in nearly four-year-low territory. AAP shares have shed 45.5% year-to-date, guided to a path of lower lows by their 40-day moving average.

Analysts, however, still remain hopeful. Of the 18 brokerages covering AAP, nine rate the stock a "buy" or "strong buy." This means that there is plenty of room aboard the bearish bandwagon, and additional downgrades could send the stock even lower.

KORS Stock Gets A Bearish Rating From Bernstein

Michael Kors stock is down 1.1% to trade at $42.21, after Bernstein initiated coverage on the retailer with an "underperform" rating and a price target of $37. KORS stock has pulled back since its earnings-induced bull gap in early August, but has still managed to tack on 20% during the last three months.

In the options pits, traders have preferred puts over calls. KORS sports a Schaeffer's put/call open interest ratio (SOIR) of 2.79, which ranks 1 percentage point from a 52-week high. This suggests that short-term option players have rarely been more put-heavy toward KORS this year.

Bernstein Initiates Under Armour at 'Underperform'

Under Armour stock is down 1% to trade at $17.24, after Bernstein initiated coverage on the apparel stock with an "underperform" rating and $14 price target -- in four-year-low territory. Like its sector peers, UAA stock has struggled lately, shedding 54% the last 52 weeks and underperforming the broader S&P 500 Index (SPX) by over 27 percentage points during the last three months.

Under Armour stock's rough stretch hasn't gone unnoticed by short sellers. While short interest retreated over the last two reporting periods, the 51.62 million shares still sold short represents a healthy 10% of UAA's total available float, or nine times the stock's average daily trading volume.

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