|Upgrades & Downgrades: Hershey’s Not So Sweet|
By Justin Sharon JAN 26, 2010 9:25 AM
Maybe the experts know something we don't know.
The gains were slim, the volume slight, and the finish sluggish but stocks did manage to Kiss their three-day slump goodbye with a little help from Gene Simmons. A day after Big Apple bravado proved premature, Cupertino’s Apple (AAPL) showed that speaking softly more often carries a big uptick. The firm famous for its conservative forecasts once again handily beat the Street, even if it erred in failing to issue Apples-to-Apples accounting. With Big Mac sales (up 33%) boosting its bottom line; McDonald’s (MCD) -- in the red on the day -- was green only with envy. Steak place Benihana (BNHN) also failed to sizzle, sliding 11.84%, but Ben Bernanke enjoyed a better day with his renomination as Fed head seemingly secure. See also What I Would Do as Fed Chairman.
That his job is to burst bubbles before they begin was made clear as Sealed Air (SEE) deflated 1.81% on the day its plastic pops turned 50. The FOMC begins its two day policy meeting today and improvements are expected in November’s Case-Shiller home price survey at 9:00AM Eastern and the Conference Board’s January consumer confidence index at 10:00AM. Peak earnings week continues with Corning (GLW), Delta Air Lines (DAL), DuPont (DD), EMC Corp (EMC), Gilead (GILD), Johnson & Johnson (JNJ), Novartis (NVS), Siemens (SI), Sun Microsystems (JAVA), Travelers (TRV), US Steel (X), Verizon (VZ), and Yahoo (YHOO) all reporting results.
Wal-Mart (WMT): The retail giant is assumed with a Strong Buy and $63 target price at Raymond James.
Sirius XM Radio (SIRI): The stock is started with a Buy at Lazard, which cites its falling costs and over 18.5 million subscribers.
Liberty Starz (LSTZA): The broker also picks up Liberty Starz (Buy; $73 target).
American Water Works (AWK): The stock is begun with a Buy and $26 price objective at Morgan Joseph as the stimulus package is an opportunity for the firm.
Blue Nile (NILE): The stock is now covered with a Hold by Benchmark.
Thomas & Betts (TNB): Robert Baird bets on Thomas & Betts (Outperform and $42 target) as it says the company is well positioned for resumed growth in electricity consumption.
Utility Stocks: In the electric and utilities space, SunTrust starts American Electric Power (AEP), CMS Energy (CMS), and Edison International (EIX) with Buys.
American Express (AXP): The credit card stock is upgraded to Neutral at from Sell with a $40 target at Ladenburg Thalmann, which cites the company’s solid positioning for a rebound in growth and credit.
Morgan Stanley (MS): The bank is moved to Outperform from Market Perform by William Blair. See also All Banks Facing Increased Scrutiny.
Texas Instruments (TXN): Robert Baird boosts Texas Instruments to Outperform from Neutral after a fourth quarter which exceeded consensus expectations.
Alcoa (AA): BMO Capital raises Alcoa to Market Perform from Underperform.
Lexmark International (LXK): Barclays upgrades Lexmark International (Overweight from Equal-weight).
Limited (LTD): The retailer gets lifted to Outperform from Market Perform by BMO Capital with a target of $25.
TheStreet.com (TSCM): The stock gets an Outperform-from-Market Perform boost by JMP Securities, which takes its target to $5.
State Street (STT): The financial stock is now Buy from Hold at Argus with a $60 target price.
KB Home (KBH): The homebuilder is up to Outperform from Market Perform at Raymond James with an $18 price objective.
China Sunergy (CSUN): The stock is up sharply ahead of the open after it was among the solar stocks upgraded (Hold from Underperform) at Jefferies.
Amylin Pharmaceuticals (AMLN): Citigroup raises its Amylin Pharmaceuticals rating to Buy from Hold. For a related story, see Which Annoying Pharma Ads Work Best.
Applied Materials (AMAT): Oppenheimer increases Applied Materials to Outperform from Perform with a $20 target on promising channel checks.
Hershey Foods (HSY): The stock gets added to the Conviction Sell list at Goldman Sachs, which expects below-consensus 5% growth in EPS in 2010.
St. Jude Medical (STJ): The stock is now Hold from Buy at Lazard.
Anixter International (AXE): AXE is cut to Underperform from Neutral at Credit Suisse, reflecting a lower risk/reward profile relative to the group.
CIGNA (CI): CIGNA is downgraded to Perform from Outperform at Oppenheimer ($38 price objective) as its analysis suggests the company significantly underpriced its Medicare PFFS products in 2010.
Johnson Controls (JCI): UBS downgrades Johnson Controls, now Neutral from Buy.