Investment Analysts’ Downgrades for December, 6th (AVEO, HPQ, ORCL, TOL, TROW, TSN, UAN, UBA, UTL, VLY)

Investment Analysts’ downgrades for Wednesday, December 6th:

AVEO Pharmaceuticals (NASDAQ:AVEO) was downgraded by analysts at Zacks Investment Research from a hold rating to a sell rating. According to Zacks, “AVEO reported mixed Q3 results with earnings beating estimates while revenue missing the same. AVEO is heavily dependent on partnerships for pipeline development and funds. If any of the company’s partners fails to receive regulatory approvals or terminates a deal, AVEO’s future prospects would be severely hampered. Moreover, the company has suffered a string of pipeline setbacks in the past which may have an adverse impact on the stock. Additionally, the company’s targeted renal cell carcinoma (RCC) space is highly crowded with presence of big players in the area, which is another matter of concern for the company. However, the company got a huge boost with the approval of Fotivda in Europe for first-line treatment of advanced renal cell carcinoma. It is the first approved product in AVEO’s portfolio. Shares of the company have outperformed the industry so far this year.”

HP (NYSE:HPQ) was downgraded by analysts at Zacks Investment Research from a buy rating to a hold rating. According to Zacks, “HP reported stellar fourth-quarter fiscal 2017 results driven mainly by strength in Personal System and Printing segments. We are impressed by the performance of HP’s PC segment, wherein the year-over-year increase was witnessed due to growth in Commercial and Consumer revenues. HP’s efforts to turn around the business have been commendable. The company is working on product innovation, differentiation and enhancing the capabilities of its printing business to stabilize the top line. Furthermore, looking at the recently released data on PC shipment by IDC depicts that HP’s restructuring initiatives which includes divestment of non-core assets and cutting jobs to lower costs along with focus on product innovations, pricing, marketing and sales activities, are paying off. Nonetheless, pricing pressure due to intense competition remains a major concern. Moreover, a tepid IT spending environment adds to its woes.”

Oracle (NYSE:ORCL) was downgraded by analysts at Zacks Investment Research from a buy rating to a hold rating. According to Zacks, “Oracle has underperformed the industry on a year-to-date basis. The company’s soft outlook for the second quarter reflects intensifying competition from Microsoft Azure and Amazon Web Services (AWS) in the cloud. Moreover, higher investments on PaaS and IaaS will keep margins under pressure in the near term. Nevertheless, we believe that the company is benefiting from significant momentum in the SaaS offerings. Oracle claims that it is wining market share against salesforce.com and Workday, which is a significant growth driver. We believe the company’s growing cloud market share will continue to drive top-line growth in the foreseeable future. Moreover, the next-generation autonomous database, which is supported by machine learning, is a key catalyst. Further, the company has positive record of earnings surprises in recent quarters.”

Toll Brothers (NYSE:TOL) was downgraded by analysts at Zacks Investment Research from a buy rating to a hold rating. According to Zacks, “Toll Brothers missed analysts’ expectations on both earnings and revenues in fourth-quarter fiscal 2017. However, earnings increased 72.6%, while revenues were up 9% year over year, given the higher number of homes delivered. Deliveries increased 9% in units, while contracts surged 20% in dollars and 15% in units on a year-over-year basis. The fourth quarter marked the 13th consecutive quarter of year-over-year growth in contract dollars and units. However, average price of homes delivered remained almost flat year over year during the quarter. Toll Brothers believes prices will further suffer and have an adverse impact year over year on adjusted gross margin. Again, rising building materials and labor costs are growing concerns for its margin. Meanwhile, its shares have underperformed the industry it belongs to on a year-to-date basis.”

T. Rowe Price Group (NASDAQ:TROW) was downgraded by analysts at Zacks Investment Research from a buy rating to a hold rating. According to Zacks, “Shares of T. Rowe Price have outperformed the industry over the last six months. The company's earnings surprise history is decent. It has surpassed the Zacks Consensus Estimate for earnings in two of the trailing four quarters. The company’s planned strategic initiatives like investment in technology and advisory services, strengthening distribution platform, along with introduction of products, will likely stoke long-term growth. Further, it remains debt-free with sufficient liquidity and is focused on boosting shareholders’ confidence through steady capital deployment activities. However, given the strategic initiatives, management estimates operating expenses to flare up 11% for 2017. Also, the regulatory pressure across the investment management industry remains another key concern.”

Tyson Foods (NYSE:TSN) was downgraded by analysts at Zacks Investment Research from a strong-buy rating to a hold rating. According to Zacks, “Tyson Foods has surpassed the industry in the past six months owing to strong performance in all business segments, particularly Chicken and Beef. The prepared foods category has also been depicting solid growth, courtesy of rising demand for protein-packed brands and synergies from the AdvancePierre’s buyout. Apart from this, divestment of non-protein businesses and poultry production expansion efforts signify the company’s focus on strengthening protein-packed brands portfolio. Notably, Tyson Foods’ growth drivers fueled results in fourth-quarter fiscal 2017, wherein both top and bottom lines grew year over year and topped estimates. The solid results also encouraged management to issue a favorable view However, the company remains exposed to the risk of raw materials price volatility. Also, stiff competition and intense promotions remain headwinds. Rising wage costs also pose threats to Tyson Foods’ operating results.”

CVR Partners (NYSE:UAN) was downgraded by analysts at Zacks Investment Research from a hold rating to a strong sell rating. According to Zacks, “CVR Partners has underperformed the industry it belongs to over a year. The company remains exposed to headwinds from weak nitrogen fertilizer prices, which may continue to put pressure on its bottom line. Abundant nitrogen supply driven by new production capacity is expected weigh on global prices this year. The company also faces intense price competition.”

Urstadt Biddle Properties (NYSE:UBA) was downgraded by analysts at Zacks Investment Research from a buy rating to a hold rating. According to Zacks, “Urstadt Biddle Properties is a self-administered equity real estate investment trust that provides investors with an investment vehicle for participating in ownership of income-producing properties. Their core properties consist principally of community shopping centers located in the northeast. “

UNITIL (NYSE:UTL) was downgraded by analysts at Zacks Investment Research from a buy rating to a hold rating. According to Zacks, “Unitil Corporation is a registered public utility holding company and the parent company of the Unitil System. “

Valley National Bancorp (NYSE:VLY) was downgraded by analysts at Zacks Investment Research from a hold rating to a sell rating. According to Zacks, “Valley National Bancorp is a bank holding company whose principal subsidiary is Valley National Bank. Valley National Bank provides a full range of commercial and retail banking services through branch offices located in northern New Jersey. These services include the following: the acceptance of demand, savings and time deposits; extension of consumer, real estate, Small Business Administration and other commercial credits; title insurance; investment services; and full personal and corporate trust, as well as pension and fiduciary services. “

Xenia Hotels & Resorts (NYSE:XHR) was downgraded by analysts at Zacks Investment Research from a strong-buy rating to a sell rating. According to Zacks, “Xenia Hotels & Resorts, Inc. is a self-advised and self-administered REIT. The company invests primarily in premium full service, lifestyle, urban upscale hotels, lodging markets as well as leisure destinations primarily in the United States. Xenia Hotels & Resorts, Inc. is based in Orlando, Florida. “

Xylem (NYSE:XYL) was downgraded by analysts at Zacks Investment Research from a buy rating to a hold rating. According to Zacks, “Year to date, Xylem's shares have outperformed the industry. The company believes robust semiconductor and industrial end-markets' demand will continue to drive its revenues in the quarters ahead, while greater operational efficacy will boost bottom-line results. Integration process of the Analytics and Sensus businesses is right on track and is expected to drive its Measurement and Control Solutions segment's performance in the upcoming quarters. Xylem also intends to fund strategic investment projects and boost shareholders' return on the back of increased cost savings. However, Xylem's stock looks overvalued compared to the industry. Moreover, we expect that headwinds such as a stronger U.S. dollar, supply chain challenges or unfavorable climatic conditions might weigh over the company's near-term results.”

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