In this article, we will take a look at the 10 stocks that recently received price-target cuts from analysts.
Tech stocks, including Dell Technologies Inc. (NYSE:DELL), Marvell Technology, Inc. (NASDAQ:MRVL) and Affirm Holdings, Inc. (NASDAQ:AFRM), came into the spotlight after receiving price-target cuts from analysts.
In addition, premier omnichannel retailer Macy’s, Inc. (NYSE:M) and luxury department store chain Nordstrom, Inc. (NYSE:JWN) were also trending after analysts cut their price targets for them.
Most analysts were moved by recent earnings reports of these companies. Check out the complete article below to see specific details behind the updated price targets for these stocks.
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10. Brinker International, Inc. (NYSE:EAT)
Number of Hedge Fund Holders: 23
Piper Sandler lowered its price target for Brinker International, Inc. (NYSE:EAT) from $80 per share to $42 per share on Thursday, August 25, 2022. Analyst Nicole Miller Regan referred to the company’s lower-than-expected outlook for the full year. She also pointed towards margin pressure in the near term.
The price-target cut came a day after Brinker International, Inc. posted mixed results for its fiscal fourth quarter and issued a weak profit outlook for the full year. The casual dining restaurant company reported adjusted earnings of $1.15 per share, marginally below the consensus of $1.16 per share.
In addition, Brinker International, Inc. generated revenue of $1.02 billion in the quarter, up 1.2 percent over the year-ago period and in line with expectations. On the downside, the restaurant operating margin dropped to 10.3 percent in the quarter, from 16.9 percent in the corresponding period of 2021.
For its fiscal year 2023, Brinker International, Inc. projected adjusted earnings in the range of $2.45 – $2.85 per share, well below analysts’ average estimate of $3.65 per share.
9. Victoria’s Secret & Co. (NYSE:VSCO)
Number of Hedge Fund Holders: 24
Shares of Victoria’s Secret & Co. slipped nearly two percent on Thursday, August 25, 2022. The drop came after BMO Capital trimmed its price target for the lingerie, clothing, and beauty retailer from $50 per share to $45 per share.
BMO Capital analyst Simeon Siegel was moved by the company’s lower-than-expected revenue and a weak outlook. Siegel thinks Victoria’s Secret & Co. should focus on profitability instead of addressing weak traffic with discounts.
Victoria’s Secret & Co. recently announced disappointing sales for its fiscal second quarter, primarily due to inflationary pressure. The company’s revenue fell 6 percent on a year-over-year basis to $1.52 billion, missing the expectations of $1.56 billion.
Moreover, Victoria’s Secret & Co. gave an EPS range of break-even to 25 cents for the current quarter, significantly lower than EPS of 81 cents per share in the comparable period of 2021. The outlook also missed the consensus of 64 cents per share.
8. GDS Holdings Limited (NASDAQ:GDS)
Number of Hedge Fund Holders: 25
Deutsche Bank slashed its price target for GDS Holdings Limited (NASDAQ:GDS) from $52.50 per share to $32.80 per share on Thursday, August 25, 2022. The research firm also downgraded the data centers operator from “Buy” to “Hold.”
Deutsche Bank analyst Lucia Kwong referred to the weak Q2 performance of GDS Holdings Limited. Kwong also cautioned that the company could face elevated costs in the second half.
While GDS Holdings Limited beat sales expectations for Q2, it posted a wider-than-expected loss for the quarter. Earlier this week, the company reported an adjusted loss of 32 cents per ADS, compared to analysts’ average estimate for a loss of 30 cents.
Its adjusted gross margin also declined 330 bps to 50.7 percent, mainly due to higher costs. Moreover, GDS Holdings Limited also decreased its fiscal 2022 revenue outlook to a range of $1.38 – $1.40 billion, from its previous projection of $1.46 – $1.52 billion, amid an uncertain macro environment.
Like GDS Holdings Limited, analysts also trimmed their price target for Dell Technologies Inc., Marvell Technology, Inc. and Macy’s, Inc..
7. Affirm Holdings, Inc. (NASDAQ:AFRM)
Number of Hedge Fund Holders: 27
Shares of Affirm Holdings, Inc. plummeted over 13 percent in the pre-market trading session on Friday, August 26, 2022. The drop came after RBC Capital slashed its price target for the financial technology company from $48 per share to $40 per share, followings its mixed Q4 results and a weak outlook.
On Thursday, affirm Holdings, Inc. reported an adjusted loss of 65 cents per share, bigger than analysts’ average estimate for a loss of 58 cents. On the bright side, the quarterly revenue of $364.1 million surpassed the consensus of $355 million.
For its fiscal 2023, Affirm Holdings, Inc. expects revenue in the range of $1.6 – $1.7 billion, below Wall Street’s estimates of $1.9 billion
Discussing the results, CEO Max Levchin said in a statement:
“While the growth of online commerce is falling back to pre-COVID levels, the secular trend toward adopting honest financial products is gaining momentum. Not only does this make our mission more important but it also plays directly into Affirm’s strengths.”
6. Toll Brothers, Inc. (NYSE:TOL)
Number of Hedge Fund Holders: 29
Toll Brothers, Inc. (NYSE:TOL) received a price-target cut from Wedbush on Thursday, August 25, 2022. The research firm decreased its price target for the luxury-home builder from $62 per share to $50 per share.
Wedbush analyst Jay McCanless thinks weak demand and supply chain disruptions would likely weigh on the company’s results in the coming quarters. Nevertheless, McCanless maintained his “Neutral” rating for Toll Brothers, Inc..
The revised price target follows the company’s Q3 results. Toll Brothers, Inc. recently surpassed profit and sales expectations for its fiscal third quarter. However, it lowered its deliveries guidance for the full year, citing supply chain challenges, softer demand and labor shortages.
Toll Brothers, Inc. now expects to deliver 10,000 – 10,300 homes in its fiscal year 2022, compared to an earlier projection between $915,000 – $925,000.
5. Nordstrom, Inc. (NYSE:JWN)
Number of Hedge Fund Holders: 31
Shares of Nordstrom, Inc. hit a new 52-week low of $18.25 on Thursday, August 25, 2022. The drop came after Barclays analyst Paul Kearney trimmed his price target for the luxury department store chain from $21 per share to $18 per share.
Kearney was moved by the company’s revised outlook for the second half and fading consumer demand. Nordstrom, Inc. recently announced its Q2 results. The company managed to surpass profit and sales expectations, but its performance was overshadowed by its updated full-year outlook.
Nordstrom, Inc. now expects adjusted earnings in the range of $2.30 – $2.60 per share and revenue growth between 5 – 7 percent for its fiscal 2022. Previously, it was looking for adjusted earnings of $3.20 – $3.50 per share and revenue growth of 6 – 8 percent.
Speaking on the results, CEO Erik Nordstrom said in a statement:
“While our quarterly results were consistent with our previous outlook, customer traffic and demand decelerated significantly beginning in late June, predominantly at Nordstrom Rack. We are adjusting our plans and taking action to navigate this dynamic in the short term, including aligning inventory and expenses to recent trends, and we remain confident in our ability to deliver on our long-term strategic and financial goals.”
4. Advance Auto Parts, Inc. (NYSE:AAP)
Number of Hedge Fund Holders: 33
RBC Capital trimmed its price target for Advance Auto Parts, Inc. (NYSE:AAP) from $217 per share to $199 per share on Thursday, August 25, 2022. RBC Capital analyst Steven Shemesh referred to the company’s lower-than-expected Q2 sales.
Shemesh now expects Advance Auto Parts, Inc. to report a full-year operating margin close to the low end of its outlook. Moreover, the analyst sees limited positive catalysts for the automotive aftermarket parts retailer in the near term.
Earlier this week, Advance Auto Parts, Inc. posted weak results for its fiscal second quarter, as higher fuel prices and record inflation hurt the demand for its products. The Raleigh-based company reported adjusted earnings of $3.74 per share, missing the consensus of $3.76 per share. Revenue inched up 0.6 percent to $2.7 billion, behind the expectations of $2.75 billion
Moreover, Advance Auto Parts, Inc. also lowered its full-year sales outlook to a range of $11 – $11.2 billion, from its earlier guidance between $11.2 – $11.5 billion. The updated outlook was below the consensus of $11.34 billion.
3. Macy’s, Inc. (NYSE:M)
Number of Hedge Fund Holders: 39
Shares of Macy’s, Inc. fell nearly four percent on Wednesday, August 24, 2022, after Citi analyst Paul Lejuez lowered his price target for the department stores operator from $23 per share to $21 per share.
The price-target cut came a day after Macy’s, Inc. slashed its profit outlook for the full year. Macy’s, Inc. now anticipates adjusted earnings in the range of $4 – $4.20 per share, down from its earlier guidance between $4.53 – $4.95 per share.
The revised outlook also overshadowed Macy’s better-than-expected Q2 results. Macy’s, Inc. reported adjusted earnings of $1 per share, topping estimates of 86 cents. Revenue increased to $5.6 billion, while analysts were looking for $5.49 billion.
Speaking on the results, CEO Jeff Gennette said:
“During the second quarter, we delivered solid results, despite the challenging environment. Our teams have consistently responded to the dynamic landscape with disciplined, data-driven actions to ensure the health and stability of our business. We believe that we are well positioned to respond to changing consumer behaviors.”
2. Dell Technologies Inc. (NYSE:DELL)
Number of Hedge Fund Holders: 49
Shares of Dell Technologies Inc. turned red in the pre-market trading session on Friday, August 26, 2022. The drop came after Barclays trimmed its price target for the Texas-based tech company from $54 per share to $49 per share.
On Thursday, Dell Technologies Inc. delivered mixed Q2 results and a weak sales outlook for Q3. The company reported adjusted earnings of $1.68 per share, better than the consensus of $1.64 per share. On the downside, the quarterly revenue of $26.4 billion missed analysts’ average estimate of $26.5 billion.
Moving forward, Dell Technologies Inc. expects to generate revenue in the range of $23.8 – $25 billion for the current quarter, below the consensus of $26.34 billion.
1. Marvell Technology, Inc. (NASDAQ:MRVL)
Number of Hedge Fund Holders: 63
Shares of Marvell Technology, Inc. slid nearly three percent before the opening bell on Friday, August 26, 2022. The drop came after KeyBanc analyst John Vinh slashed his price target for the datacenter semiconductor manufacturer from $90 per share to $75 per share.
The latest price-target cut came a day after Marvell Technology, Inc. issued a weak sales outlook for its fiscal third quarter. The company expects revenue of about $1.56 billion for the current quarter, below analysts’ average estimate of $1.58 billion.
Marvell Technology, Inc. issued the outlook along with its fiscal second-quarter results. The California-based company reported adjusted earnings of 57 cents per share on revenue of $1.517 billion. On the other hand, analysts expected Marvell Technology, Inc. to earn 56 cents per share on revenue of $1.52 billion.
Speaking on the results, CEO Matt Murphy said in a statement:
“Looking ahead, we expect sequential revenue growth to accelerate in the fourth quarter as supply constraints begin to ease. We believe we are well positioned to continue to benefit from our favorable end market exposure tied to strong secular growth trends and significant expected upcoming revenue contributions from a number of Marvell-specific product ramps.”
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This article is originally published at Insider Monkey.
