Viacom Inc. (VIAB) shares fall following downgrade at Wedbush

Viacom Inc. (NASDAQ: VIAB) shares fell on Tuesday Dec 13 with lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.

Meanwhile, the Dow DJIA, +0.47% climbed 106 points, or 0.6%, to 19,905. If the Dow finishes higher, it will notch its seventh straight gain.

The S&P 500 index SPX, +0.56% gained 10.45 points, or 0.5%, to 2,267 and the tech-heavy Nasdaq Composite Index COMP, +1.02% added 48 points, or 0.9%, to 5,461.

Both the S&P 500 index SPX, +0.56% and Nasdaq Composite COMP, +1.02% ended lower on Monday, with investors appearing reluctant to push shares higher ahead of the Fed meeting

Analysts at Wedbush downgraded shares of Viacom Inc. (NASDAQ: VIAB) from Outperform to Neutral in a research note to investors today. With a rating of Neutral on the shares, Viacom Inc. has a 52-week high of $47.47. The one-year price target of $42.55 is above the opening price of $34.38, resulting a fair amount of other analysts to comment on the stock in recent days. Considerable and fundamental digressions in the company’s actions, future outlook or industry can cause downgrades as the analysts feel that the future prospects for the security have dropped from the original recommendation.

Shares of Viacom Inc. (NASDAQ: VIAB) opened at $34.38 on Tuesday trading between $33.94 and $34.72, and last traded at $34.50, which is a dip of $0.29 per share or -0.83% over the previous closing price.

Viacom Inc. (NASDAQ: VIAB) currently has a market cap of 13.69B.

Viacom Inc. (NASDAQ: VIAB) Average Daily Trading Volume

The stock’s average daily volume is 4,228,030 shares out of a total float 355,524,000 and some 1,136,874 shares traded hands yesterday, lower than normal. Momentum traders often use swings in trading volume to pinpoint large volume accumulation or circulation by institutional investors, so look for trading volume to pick up in the coming days.

While increased trading for one day will not mean much, conversely, a trend of heavy trading volume on the buy side over a series of days or weeks delivers a positive cue to market traders that institutions may be moving in, so institutional sponsorship is crucial.

Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.

Institutional investors such as these have substantial teams of analysts that research thousands of stocks, so it is good validation to see them buying a stock you are considering.

Viacom Inc. (NASDAQ: VIAB) Moving Averages

A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.

This is because the average acts like a floor (support), so the price bounces up off of it.

In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.

By marking the activity of these professional investors—and the moving averages they affect—it allows for traders to make more impactful judgments on trades.

With that in mind, Viacom Inc. (NASDAQ: VIAB) now has a 50-day MA of $37.46 and 200-day MA of $40.19. It has traded in a 52-week range between $30.11 – 47.47 and today’s last price is 27.32%% lower than the 52 week high of $47.47.

Indeed, earnings growth is among the most important things to look at in regards to stock investing and, accordingly, investors identify companies that have been successful at growing their earnings at least 25% or more for a 3 year period.

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