United Health & Humana
Deutsche Bank released two new healthcare company ratings today. United Health was upgraded by the firm to “buy” from hold” sending the stock to an all-time high, while Humana’s rating was cut to “sell” from “hold.” The firm cited United Health’s improving margin-risk profile and conservative approach to the public exchanges in 2014 as reasons for the higher rating. Humana, however, was downgraded because analysts said they see above-average risks for the company this year. Shares of United Health rose three percent to $76.51, making it today’s best-performing Dow component. Shares of Humana fell slightly to $100.55.
Eli Lilly was out with a poor outlook today. The drug maker expects a slump in both earnings and revenue this year, but the forecast is still in line with estimates. Lilly said the loss of drug patents are to blame. Shares were down slightly, ending at $51.19.
Pharmacyclics & Johnson & Johnson
Pharmacyclics’ shares surged today after positive news for a drug it developed with Johnson & Johnson. A late-stage trial of the company’s Leukemia treatment was stopped early because the therapy met study goals. The stock climbed almost 20 percent to $125.90. Johnson & Johnson’s shares also gained two percent to $94.29.
Last year’s top performing stock in the S&P 500 was downgraded by Morgan Stanley today. The video-streaming service company had its rating cut to “underweight” from “equal weight” because of concerns over increasing competition from players like Hulu, HBO GO and Amazon Prime Instant Video. Shares of Netflix tumbled 5.5 percent to $339.50.
Michael Kors also took a hit after its rating was slashed by Citi. The firm downgraded the luxury-goods maker to “neutral” from “buy.” The analyst cited the company’s lofty stock price and the potential for slower accessories sales as reasons for the cut. The stock dropped nearly four percent to $79.
Sonic reported a profit surge of 34 percent, helped by sales growth and slightly lower costs. After those strong earnings, the drive-in restaurant chain revealed it is looking to expand in to competitive markets in the Northeast and California. Shares popped more than 4.5 percent to $20.15.