Q2 STOCKS TO BUY

eBay Counters Amazon; Acuity Brands Stock Jumps After Earnings

A lot of traders were bearish on AYI shares before earnings

Jul 3, 2018 at 11:49 AM
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Stocks have pared most of their gains, but remain modestly higher ahead of today's early close. Three stocks making noteworthy moves are e-commerce concern eBay Inc (NASDAQ:EBAY), lighting expert Acuity Brands, Inc. (NYSE:AYI), and drugmaker Epizyme Inc (NASDAQ:EPZM). Below, we will take a closer look at how shares of EBAY, AYI, and EPZM are trading.

EBAY Stock Ticks Higher

eBay stock is trading up 0.5% at $36.87, after the company countered Amazon's (AMZN) July 16 Prime Day scheduling by saying it'll be offering exclusive deals the day after, on July 17. The shares have struggled this year, however, suffering a series of lower highs and lows since peaking near $47 back in early February. Still, most analysts have remained bullish on EBAY, with 15 of 25 saying it's a "buy" or "strong buy." Moreover, the average 12-month price target stands all the way up at $48.50, a nearly 32% premium to current levels. This setup could sound alarms for contrarian traders, who may view EBAY as a candidate for bearish analyst attention going forward.

AYI Stock Shocks Skeptics with Post-Earnings Rally

AYI stock is up 14.3% at $133.85, after the company's fiscal third-quarter earnings results easily topped estimates. While this price action has Acuity Brands well above recent resistance in the form of the 50-day moving average, the shares remain 24.4% lower year-to-date. Still, many skeptics were seemingly caught off guard by AYI's move.

For example, the equity's Schaeffer's put/call open interest ratio (SOIR) comes in at 2.78, an annual high, showing an extreme put-skew among near-term options traders. Elsewhere, short interest rose another 9.2% in the last two reporting periods, and more than 13% of the total float is now sold short.

Leerink Downgrade Sinks EPZM Stock

Shares of EPZM have fallen 8.1% to $12.50, putting them back in the red year-to-date and on pace for their lowest close since early January, The pullback is a result of Leerink's downgrade to "market perform" from "outperform," with the brokerage firm also cutting its price target to $16 from $24. The bear note is a rarity for Epizyme, as eight of the nine analysts in coverage had "strong buy" ratings in place before today.

 

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