Citi declared a few weeks ago it had three equity analysts focused solely on Apple, which generated a bit of intrigue and also some ridicule (some traders thought it was “just a marketing ploy” by Citi, according to CNBC). Those analysts came out with a ‘buy’ recommendation, though with a target price of $675, below consensus.
But now in the depths of December, Citi’s Glen Yeung, Walter Pritchard and Jim Suva have cut the rating to ‘neutral’ and the target price to $575. Investors in Hon Hai Precision (aka Apple’s biggest supplier, Foxconn) did not like it one bit:
From the New York Times, a Gretchen Morgenson report into an apparently widespread practice of Wall Street analysts giving private equity clients and hedge funds a heads up into their thinking, via the hedgies’ monthly or quarterly “questionnaires”:
The funds say they ask only for public information, but in at least four cases, documents from Barclays Global Investors, now a unit of BlackRock, state the goal is to receive nonpublic information. Two documents state that the surveys allow for front-running analyst recommendations. Read more
Sighted in the Long Room — one almighty visualisation of UBS analysts: