In this article, we discuss the 5 stocks recently downgraded by analysts. If you want to see some more companies on the list, go directly to Analysts are Downgrading These 10 Stocks.
5. Lincoln National Corporation (NYSE:LNC)
Number of Hedge Fund Holders: 34
Morgan Stanley downgraded Lincoln National Corporation (NYSE:LNC) from “Overweight” to “Equal-Weight” on Thursday, November 3, after the health insurer swung to a loss in the third quarter.
Lincoln National Corporation (NYSE:LNC) recently reported an adjusted loss of $10.23 per share for Q3, compared to adjusted earnings of $1.62 per share in the same period last year. Revenue for the quarter fell 8.4 percent on a year-over-year basis to $4.8 billion. Analysts were looking for earnings of $1.79 per share on revenue of $4.39 billion. Lincoln National shares plummeted to a nearly two-year low on Thursday following the results.
Speaking on the results, CEO of Lincoln National Corporation (NYSE:LNC), Ellen Cooper, said in a statement:
“The significant charge we recorded during the third quarter and the statutory capital impact to be booked at the end of 2022 resulted from our annual assumption review primarily due to policyholder lapsation behavior in our guaranteed universal life insurance block and will contribute to a decline in our RBC ratio.”
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4. Cognizant Technology Solutions Corporation (NASDAQ:CTSH)
Number of Hedge Fund Holders: 36
Shares of Cognizant Technology Solutions Corporation (NASDAQ:CTSH) hit a new 52-week low of $51.33 on Thursday, November 3, following its mixed financial results for the third quarter.
The mixed performance compelled BMO Capital to cut its ratings for Cognizant Technology Solutions Corporation (NASDAQ:CTSH) from “Outperform” to “Perform.” Analyst Keith Bachman thinks 2023 will be a difficult year for the IT services market due to an uncertain macro environment.
Moreover, Bachman doesn’t see any near-term catalyst for Cognizant Technology Solutions Corporation (NASDAQ:CTSH). He also trimmed his price target for Cognizant from $73 per share to $65 per share.
The downgrade came a day after Cognizant Technology Solutions Corporation (NASDAQ:CTSH) posted revenue of $4.9 billion, up 2.4 percent on a year-over-year basis but below the consensus of $5.01 billion. On the bright side, the adjusted earnings of $1.17 per share surpassed estimates of $1.16 per share.
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3. Stryker Corporation (NYSE:SYK)
Number of Hedge Fund Holders: 46
Canaccord analyst Kyle Rose lowered his ratings for Stryker Corporation (NYSE:SYK) from “Buy” to “Hold” on Tuesday, November 1, following the company’s Q3 earnings. Rose believes the ongoing headwinds would likely continue next year. He also cut his price target for Stryker from $225 per share to $220 per share.
The downgrade came a day after the medical technology company released its Q3 results. Stryker Corporation (NYSE:SYK) reported adjusted earnings of $2.12 per share, down 3.6 percent over the year-ago period and below the consensus of $2.23 per share. Revenue for the quarter rose 7.7 percent versus last year to $4.5 billion, matching expectations.
Stryker Corporation (NYSE:SYK) also revised its profit outlook for 2022, citing inflationary pressure. It expects adjusted earnings in the range of $9.15 – $9.25 per share, below its previous projection between $9.30 – $9.50 per share.
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2. Nutrien Ltd. (NYSE:NTR)
Number of Hedge Fund Holders: 48
Shares of Nutrien Ltd. (NYSE:NTR) plummeted to a nearly seven-month low on Thursday, November 3, following its disappointing results for the third quarter. Referring to the latest earnings miss, research firm Scotiabank downgraded the fertilizer giant from “Outperform” to “Sector Perform.”
Nutrien Ltd. (NYSE:NTR) earned $2.51 per share on an adjusted basis, missing the consensus of $3.97 per share with a big margin. Moreover, the quarterly revenue of $8.18 billion also came in below the consensus of $8.78 billion.
Meanwhile, Nutrien Ltd. (NYSE:NTR) also lowered its full-year profit outlook amid lower potash sales volumes and weakening prices. The company now expects adjusted earnings in the range of $13.25 – $14.50 per share, well below its previous guidance between $15.80 – $17.80 per share.
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1. Zillow Group, Inc. (NASDAQ:Z)
Number of Hedge Fund Holders: 51
Canaccord downgraded Zillow Group, Inc. (NASDAQ:Z) from “Buy” to “Hold” on Thursday, November 3. Analyst Maria Ripps was primarily moved by the lower-than-expected sales outlook for the fourth quarter.
Ripps believes the latest guidance represents a deteriorating real estate environment, with volatile mortgage rates affecting the customers’ buying power. The analyst also thinks the company’s estimates for 2023 are at risk given the elevated mortgage rates. She trimmed her price target for Zillow Group, Inc. (NASDAQ:Z) from $48 per share to $34 per share.
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The downgrade came a day after Zillow Group, Inc. (NASDAQ:Z) released its Q3 results. While the tech real-estate marketplace company surpassed financial expectations for the quarter, it issued weak sales guidance for Q4.
You can also take a peek at 10 Best Monthly Dividend Stocks To Buy and 12 Best Consumer Staple Stocks.
