INTC, HPQ Downgraded
Wednesday, September 8, 2010 at 03:04PM UBS analysts downgraded both Hewlett Packard (HPQ) and Intel (INTC) from Buy to Neutral this morning. The overall market is having a strong day on the upside, but the downgrades have caused both HPQ and INTL to sell off. But should these stocks be down just because someone lowered his/her rating on the stock? Before blindly selling a name because of a downgrade, it's important to at least look back at the prior recommendations of the analyst making the call.
UBS seems to have a pretty good record on Hewlett in recent years. In late 2008 and early 2009, UBS had a Neutral rating on HPQ, but the firm upgraded the name from Neutral to Buy on March 11th 2009 right near its lows. While HPQ has gone from the mid-$50s down to $40 over the last couple of months, the stock was up quite a bit over the entire "Buy" period. We'll see where it goes from here.
In regards to Intel, the firm has had a Buy rating on the stock since at least 2006, over which time the stock has gone from $21 to $17. There were no changes in recommendations on Intel throughout the entire market decline or recovery, so this is a big change for UBS. After being dead money for multiple years now, it appears the firm has given up on the Buy call.
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