Those Crazy Analysts...
If an analyst told you that a stock was going to go up 40% in a year, you'd think that was good news right?
Well, not according to Scott Gleason at Stephens, Inc. Although he gave Genoptix (GXDX) a price target of $45 (highest of all the anaylsts covering GXDX), he still downgraded the stock to Equal-Weight (from Overweight) last night after it closed at a 4 month low at $32.60, briefly knocking GXDX down below $30 in early trading today. If you do the quick division, that was a 38% gain he expected from the stock after yesterday's close... but not good enough to buy, I guess.
You'd think, "Maybe he's saying that other companies in this sector are an even better buy!" Well, let's look at one he calls Overweight. Quidel Corp (QDEL) was upgraded by Stephens from Underweight to Equal-weight with a target of $16 on Dec 1, when the stock was around $13. Stephens again upgraded the stock on January 6 to Overweight when the stock reached $14, maintaining the same $16 dollar target.
I'm no rocket surgeon, but I don't think this man has been properly interpreting his DCF models.
On a side note, does anyone know a good (free) site that follows these analysts better than Yahoo Finance? Yahoo's site seems to be pretty spotty.