4. Street Stroke
Temperatures have been averaging more than 90 degrees in New York City this week, so we suspect that's why Wall Street's analyst reports have been, well, a tad suspect of late.
Admittedly, it's not easy to do your best work when drained of fluids. That's why we suggest the Street's scribes hydrate more before publishing research notes that don't represent their best work, or perhaps hydrate less at places like Hanover Harry's or PJ Clarke's.
For example, the oppressive hotness must have had something to do with UBS's Eric Sheridan's decision on Monday to cut his rating on shares of Yelp (YELP) to Neutral from Buy, while raising his price target to $40 from $32. Shares of the money-losing internet referral provider have more than doubled this year to more than $40, undoubtedly squeezed higher by bears who sold more than 16% of the company's float short at last check.Not that Sheridan gives the bloodied shorts too much credit for helping push the stock to an all-time high of course. No, in his newly Neutral view, the company's performance alone is what's rallying the stock. "Yelp's shares appear to be fairly valued at current levels," wrote Sheridan about the internet company with a gob-smacking forward P/E of 226. "That said, we continue to believe that Yelp is one of the best positioned businesses within our coverage universe in terms of key secular themes (social, local, & mobile)." Let's get this straight again. After the stock blew through his last price target, Sheridan is setting a new one 25% higher, while cutting his rating. And he says the company is perfectly "positioned," but still "fully valued," even though its clearly trading at nose-bleed levels. Yeah, we know the whole thing is puzzling for those unfamiliar with Wall Street double-speak. But don't sweat it Dumbest fans. It's not the heat that's getting you. It's the stupidity.