Hot Stocks: Investment Banks, Netflix Among Tuesday's Movers
Analyst actions and earnings news were some of the catalysts behind the most actively traded stocks on Tuesday.
Financial stocks were in focus and Lehman Brothers rose on heavy trading volume after the investment banking firm reported strong quarterly earnings. Credit Suisse analyst Susan Roth Katzke said the report showed "very solid results out of Lehman and a good start to broker earnings season."
"You have to feel better after results like these," Katzke said in a client report.
Shares of Goldman Sachs, which reports quarterly results later this week, also saw gains on above-average volume.
Take-Two Interactive Software gained after the video game maker announced a restructuring plan.
JP Morgan Securities upgraded the stock to "outperform" and was positive on the company's efforts to save $25 million by the end of the next fiscal year.
Elsewhere in technology, a handful of chip-related stocks gained on a rebound in market prices for NAND flash memory as well as positive industry comments from chip equipment maker Lam Research .
Shares of Intel rose more than 1%, Marvell Semiconductor Group rose 2% and Nvidia traded slightly higher after pulling back from intraday highs.
Among downside movers, shares of Netflix plunged more than 7% after Citigroup downgraded the stock to "sell" from "hold," citing increased competition from rival Blockbuster, which recently cut prices for online-only DVD subscriptions.
"The price cuts will likely increase the competitive pressures on Netflix and make it significantly more difficult to sustain earnings, especially in light of first-quarter guidance in which Netflix trimmed top-line guidance but maintained earnings," said analyst Tony Wible, in a research note. "We expect that Netflix will eventually have to match the price cuts or lose significant share to Blockbuster."
The analyst also addressed speculation regarding a potential takeover from Amazon.com.
"We see Amazon buying Netflix as being a possibility but not a probability," he said. "For Amazon, the rationale would be increased exposure to online video rentals, in which it has had very little traction to date."
Peter Kang is a markets writer for CNBC.com. He can be reached at firstname.lastname@example.org.