On November 24th Goldman Sachs issued a sell rating on Chicago Bridge and Iron (CBI). This news pushed the stock down 4.96% to $54.26. There was also a much higher volume of options being traded, with a large increase in put options, probably a reaction to the Goldman downgrade. The bank did not give word on what caused the rating change from neutral to sell.
With a large amount of short interest in the stock, I look forward to a short squeeze after the company reports what I believe will be a strong fourth quarter and solid full year 2014.
CBI continues to be undervalued and maintains strong growth prospects. The stock is only slightly below our buy-in price, and maintains a consensus target price with 25% upside.