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Upgrades & Downgrades: Exxon Out of Gas?

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Maybe the experts know something we don't know.

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When your day is begun by Darth Vader it's not normally a good sign, but after Star Wars' resident baddie began Big Board proceedings the Empire (State, in the form of the New York Stock Exchange) struck back and equities ended at fresh 14-month highs. Helpful housing data sent shares up for a third straight session and took the S&P 500 to within a whisker of its 50% retracement level as volume and volatility each abated. The news wasn't as good for gold, which fell to a seven week intra-day low, and treasuries continued to tumble, unnerved by news that Susan Boyle may be the next Bond girl.

President Obama met with leaders of small lenders, who were at a competitive disadvantage even without their bigger banking brethren benefiting from robber's remorse. Indeed the seasonal spirit of giving encompassed even Lehman Brothers, whose bankruptcy is evidently no impediment to big bonuses, and Spain where Europe's longest unemployment lines haven't hemmed in the world's largest lottery. In 8:30AM Eastern economics, personal income increased 0.4% last month while spending rose 0.5%, each a touch under expectations. At 9:55AM we get the final figure for December consumer sentiment from the University of Michigan and November new home sales are anticipated to tick up slightly at 10:00AM. 3Com (COMS) and American Greetings (AM) have already reported results on an otherwise quiet day for corporate earnings announcements.

Initiations

Yahoo (YHOO): The stock is resumed at Morgan Stanley with an Overweight.

Dollar General (DG): Citigroup and Deutsche Bank both begin Dollar General with a Buy, whereas Wells Fargo assigns a more cautious Market Perform.

AOL (AOL): Citigroup's been busy, also beginning AOL at Hold.

Meritage Homes (MTH): More from Citigroup, initiating Meritage Homes with a Buy.

Achillion Pharmaceuticals (ACHN): Skyrocketing before the bell is Achillion Pharmaceuticals, initiated with a Buy and $12 target at Roth Capital on positive Phase Ib protease inhibitor data.

Pride International (PDE): The stock is picked up at CK Cooper. The Buy rating and $42 target is partially based on an impressive management team.

Pike Electric (PIKE): Wedbush Morgan assumes coverage on Pike Electric at a Neutral ($10 target), with core distribution markets remaining weak.

Gold Miners: Goldman Sachs starts coverage on South Africa's Gold Fields (GFI) at Buy and AngloGold Ashanti (AU) at Neutral.

rue21 (RUE): Easy street for recent IPO rue21, initiated at an Overweight at Piper Jaffray with a price objective of $34.

Collective Brands (PSS): Payless Shoe Source parent Collective Brands is assumed at Above Average ($26 target) at Caris & Company on its broadening product portfolio.

Quanta Services (PWR): The stock gets an Outperform initiation at Wedbush Morgan.

Hi-Tech Pharmacal: Bank of America/Merrill Lynch now has an Underperform on Hi-Tech Pharmacal. Its target price is $23.

Suburban Propane Partners (SPH): Bank of America/Merrill also initiates Suburan Propane Partners (Buy and $50 price objective).

Sirona Dental Systems (SIRO): SunTrust starts Sirona Dental Systems at a Neutral.

Upgrades

Newspapers: In the newspaper space, the New York Times (NYT) gets a Market Perform-from-Underperform upgrade at Wells Fargo, while Gannett (GCI) goes one better (Outperform from Underperform).

Harmony Gold Mining (HMY): Goldman raises its rating on Harmony Gold Mining to Buy from Neutral as it should benefit from a "weakening South African rand over the next two years."

Tenet Healthcare (THC): Leerink Swann takes Tenet Healthcare to Outperform from Market Perform.

SanDisk (SNDK): The stock is higher ahead of the open after a Buy-from-Hold boost by ThinkEquity, which cites robust trends in the NAND flash space.

Corning (GLW): ThinkEquity also increases Corning to Buy from Hold as the LCD TV industry could see a robust upturn.

Schlumberger (SLB): Barclays boosts Schlumberger to Overweight from Equal-weight and raises its target price by $9 to $73.

Watson Pharmaceuticals (WPI): Bank of America/Merrill Lynch lifts Watson Pharmaceuticals to Neutral from Underweight.

Downgrades

Exxon Mobil (XOM): The oil stock is cut to Hold from Buy by Soleil Securities on lower crude and refining margins among other factors.

Cintas (CTAS): The stock is cut to Neutral from Overweight by JP Morgan.

Potash Corp (POT): The ag stock gets lowered to Reduce from Hold at TD Newcrest. See also Missing the Strike in Potash.

Allegiant Travel (ALGT): ALGT is taken to Hold from Buy at Jesup & Lamont due to valuation.

Randgold Resources (GOLD): The stock gets cut to Neutral from Buy.
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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