Analysts Upgrades and Downgrades: DIS, ALU, WFR, COST, RIG
Friday, December 09, 2021 10:33 AM

As the U.S. market started week’s last trading day on a positive note, several stocks were either upgraded or downgraded by analysts and rating agencies. Some notable stocks are discussed here.

Analysts at Needham & Co. maintain a Hold rating on the shares of Walt Disney Co. (NYSE: DIS), which operates as an entertainment company worldwide. They state that there is currently a 93 percent correlation between FY2012 return on invested capital and media industry share prices. They expect Walt Disney’s ROIC to be flat at 10.5 percent in 2012, one of the lowest performances in their coverage universe. Shares of DIS were up 1.34 percent, or $0.46, to trade at $36.40.

Alcatel-Lucent SA (NYSE: ALU), which provides products, solutions, and transformation services that enable service providers, enterprises, governments, and strategic industries to deliver voice, data, and video communication services to end-users worldwide, is raised to Outperform from Market Perform by analysts at Bernstein. ALU is planning to enhance its 100G portfolio with new technology that makes 100G transmissions more reliable while, literally, extending performance. Shares of ALU gained 4.17 percent, or $0.07, to trade at $1.62.

MEMC Electronic Materials Inc. (NYSE: WFR), which is engaged in the development, manufacture, and sale of silicon wafers for the semiconductor industry worldwide, is raised to Buy with a price target of $5 by analysts at Collins Stewart. They state that the decline seen in WFR's trading price over the past 6 weeks and its recently announced restructuring activities, which will ultimately aid cash flow and profitability, they believe WFR's market value has slipped below the inherent combined value of its SunEdison division, its semi wafer operation and the net cash on its balance sheet. They contend that this is the case even if no value is assigned to the solar wafer business or Italian poly-silicon operations. Shares of WFR added 0.48 percent, or $0.02, to trade at $4.22.

Costco Wholesale Corp. (Nasdaq: COST), which operates membership warehouses that offer a selection of branded and private label products in a range of merchandise categories in no-frills, self-service warehouse facilities, is downgraded to a Negative rating from Neutral by analysts at Susquehanna. Costco reported 12.5 percent increase in its fiscal 2012 first quarter revenue to $21.18 billion, but below analysts’ estimate of $21.29 billion. Shares of COST were down 0.82 percent, or $0.70, to trade at $85.06.

Analysts at Goldman Sachs initiated Sell rating on the shares of Transocean Ltd. (NYSE: RIG), which provides offshore contract drilling services for oil and gas wells worldwide, with a price target of $48. They state that Transocean has dominated the ultra deepwater business; its rigs, once a competitive advantage, now need extensive upgrades to keep them compliant in the post- Macondo world. Shares of RIG fell 1.57 percent, or $0.69, to trade at $43.15.