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Upgrades & Downgrades: AT&T On Hold

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Maybe the experts know something we don't know.

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The S&P 500's 0.1% increase was good for a 15-month high on the index but bourses barely budged as a second session of tight trading left equities apparently as frozen as the weather. Saying "freeze" did however prove profitable for top stun gun maker Taser (TASR), which surged 24.26% to level last seen in October of '08. An otherwise range bound market encouraged investors to stuff money in mattresses, particularly those of 5.28% gainer Tempur Pedic (TPX). Hugh Grant of Monsanto (MON), who heads Forbes' newly anointed company of the year, has further reason to celebrate after an earnings-related 1.49% share price increase. (The Morgans of his new movie are presumably impressed equity analysts at JP and Stanley.)

By contrast, Mr. Woods is still searching for Tiger balm after one of his few remaining friends, Electronic Arts (ERTS), lost 2.27%. And Verizon (VZ) shrunk 2.88% following downbeat quarterly guidance from its CEO but at least its flagship building continues to stand tall. A little too tall. Retailers' December same-store sales are trickling out and in 8:30 AM Eastern economics initial unemployment claims increased a less than expected 1,000 to 434,000. Earnings are expected out of Apollo Group (APOL), Constellation Brands (STZ), Global Payments (GPN), Lawson Software (LWSN), Lennar (LEN) (see also Seven Reasons Not to Enter Lennar), and MSCI Inc. (MXB).

Initiations

AT&T (T): The stock is picked up with a Hold and $30 price objective at Jefferies, which cites slowing US subscriber growth and ARPU pressures. For more, see AT&T: New York City "Not Ready" for iPhone.

Verizon (VZ): By contrast the broker assigns a Buy on Verizon ($37 target price), with wireless well positioned due to a high quality network.

BioMarin Pharmaceutical (BMRN): JP Morgan initiates BioMarin Pharmaceutical at Overweight. For more on this sector, see Biotechs to Start the New Year With a Bang.

Ensco (ESV): The stock is started with a Hold at C.K. Cooper, which assigns a $48 target.

GenVec (GNVC): The stock is surging before the bell in an uninspiring futures market after being begun with a Buy at Roth Capital.

Upgrades

Bank of America (BAC): The bank gets an Outperform-from-Neutral increase at Credit Suisse, the target taken up to $21 from $17.

Humana (HUM): Barclays boosts Humana to Equal-Weight from Underweight and takes its target to $53 from $36. See also Dodd, Dorgan, and Health-Care Stocks.

SPX Corp (SPW): JP Morgan increases SPX Corp to Overweight from Neutral and raises its price objective by $4 to $62.

Insurance Stocks: In insurance, Bank of America/Merrill Lynch lifts upgrades Chubb (CB) (Buy from Neutral) and Marsh & McLennan (MMC) (Neutral from Underperform).

Medical Products: Bank of America/Merrill also boosts Tenet Healthcare (THC) (Neutral from Underperform) and Zimmer Holdings (ZMH) (Buy from Neutral; $72 target).

McKesson (MCK): Deutsche Bank moves McKesson to Buy from Hold as the firm believes it has the best leverage to improved generics flow. The objective increases by $6.50 to $74.

PerkinElmer (PKI): The stock is now Buy from Hold at Deutsche Bank as shares are strongly leveraged to a cyclical upturn given the company's core instrumentation exposure.

SAP AG (SAP): The stock is upgraded to Neutral from Sell by Broadpoint Research.

Downgrades

Alcoa (AA): Dow component Alcoa is cut to Hold from Buy by Citigroup.

Rite Aid (RAD): The stock is reduced to Neutral from Overweight at JP Morgan.

Banco Santender (STD): HSBC downgrades Banco Santander to Neutral from Overweight.

AmerisourceBergen Corporation (ABC): Deutsche Bank downgrades AmerisourceBergen to Hold from Buy ($29 target maintained) as shares seem fully valued.

Insurance: Bank of America/Merrill Lynch downgrades CNA Financial (CAN) and Platinum Underwriters (PTP) to Neutral from Buy.

Lockheed Martin (LMT): The defense stock is lowered Neutral from Buy by Broadpoint as multiple expansion opportunities appear limited. The new target it $73, down from $86.

Hot Topic (HOTT): The retailer cools off with a Hold-from-Buy downgrade at Needham.

Aetna (AET): Collins Stewart cuts Aetna to Sell from Hold.

3M (MMM): The stock gets a valuation based downgrade (Neutral from Overweight) from analysts at JP Morgan, as any future growth is a "show me" story.
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No positions in stocks mentioned.
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