Here Is How Investors Reacted To The Latest Stock Upgrades and Downgrades

After a poor start of the year, U.S. stocks are having a break today, trading in a close range. Energy stocks were the biggest losers from the S&P500, as lower oil prices have also put pressure on the market. In this article we’ll take a look at the latest upgrades and downgrades of the leading firms and see how First Solar, Inc. (NASDAQ:FSLR), J C Penney Company Inc (NYSE:JCP), Nordstrom, Inc.(NYSE:JWN), Tyson Foods, Inc. (NYSE:TSN), and Capital One Financial Corp. (NYSE:COF) are faring today.

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Analysts at Goldman Sachs suggest First Solar, Inc. (NASDAQ:FSLR) is a good stock to buy, having established that the solar equipment company has the best balance sheet among its peers. In a recent note to investors, Goldman has upgraded the stock to ‘Buy’ from the previous ‘Neutral’ rating and have increased their price target to $100 from $61. The company boasts a debt-to-equity ratio of 0.06, below industry average, and quick ratio of 2.70, which implies that it can easily meet its short-term obligations.

First Solar, Inc. (NASDAQ:FSLR) gained a boost in popularity during the third quarter of 2015, with the number of hedge fund long positions (among the funds we track) increasing to 34, while their combined positions accounted for a little over 8% of the company’s common stock. Israel Englander is betting big on First Solar, having boosted his stake by more than 400% during the quarter. In its latest 13F filing, Millennium Management reported a position that amounted to 1.05 million shares, the largest among the funds we track.

Citigroup has issued an update on two U.S. retailers, having upgraded one of them and downgraded the other. J C Penney Company Inc (NYSE:JCP) was the one getting the nod, with analysts saying that the stock is currently trading at a fair price, having slumped by roughly 30% in the past three months. The firm has upgraded the stock to ‘Neutral’ from ‘Sell’ rating. Nordstrom, Inc. (NYSE:JWN), on the other hand, was downgraded to ‘Neutral’ from ‘Buy’, with analysts pointing to the fact that the slowdown in sales exceeded their expectations. Citigroup has also lowered its price target to $52 from $65. The stock is currently trading at $49.25, down by 1.6% from yesterday’s closing price.

Roughly 20% of J C Penney Company Inc (NYSE:JCP)’s outstanding stock was held by 35 funds from our database at the end of the third quarter, up from 31 a quarter earlier. Jim Simons‘ Renaissance Technologies has a notable position in J C Penney, having also reported a 33% increase by the end of September to approximately 14.7 million shares.

Shares of Nordstrom, Inc. (NYSE:JWN) were in great demand among hedge fund managers, as the number of long positions increased to 38 from 27 over the third quarter. While Ken Griffin was busy dumping 37% of his holding, Steven Cohen was buying left and right, increasing his investment by nearly 900%. In their latest quarterly filings, Citadel Investment Group and Point72 Asset Management reported ownership of 3.1 million shares and 857,100 shares of Nordstrom, respectively.

Shareholders of Tyson Foods, Inc. (NYSE:TSN) were not pleased by the latest update from RBC Capital, as the stock was downgraded to ‘Sector Perform’ from the previous ‘Outperform’ rating. The firm has not changed its price target, which is currently at $53 per share. The poor performance of the company’s prepared food segment was one of the main reasons behind the revision. Shares of Tyson Foods fell by as much as 3.7% in Tuesday morning trading.

Some hedge funds sought to distance themselves from Tyson Foods, Inc. (NYSE:TSN) during the third quarter, as the number of positions held by the funds we track decreased to 46 by the end of September from 50 at the end of June. David Cohen and Harold Levy’s Iridian Asset Management believed the stock was poised for growth, having increased its stake by roughly 200% to 6.5 million shares during the third quarter.

Shares of Capital One Financial Corp. (NYSE:COF) are down by 2% this morning, after the stock was downgraded by Oppenheimer. The firm said it does not expect the company to meet its expectations for 2016 and 2017, as it sees the company’s new healthcare business as the only source for growth in the near future. As a result, analysts have downgraded the stock to ‘Market Perform’ from ‘Outperform’, having made no adjustment to their previous price target of $92 per share.

Ric Dillon and his fund, Diamond Hill Capital, hold the largest stake in Capital One Financial Corp. (NYSE:COF) among the funds we track, having reported ownership of 3.74 million shares, up by 5% over the third quarter. Although the number of hedge fund positions in Capital One Financial rose to 53 during the quarter, together they held a relatively insignificant 3.7% of the company’s outstanding stock.

Disclosure: none