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Upgrades & Downgrades: Disney Gets Knocked Down

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Maybe the experts know something we don't know.

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This month's thermometer may be frightful but the January Barometer is on course to warm investors' hearts by lining their pockets. Major markets closed at weekly highs as the Dow rose on each of the year's first five sessions, an event unseen since '06, while the S&P 500 finished at its best level in 15 months. This despite disappointing jobs December data; even as an anonymous bidder was able to afford almost $10,000 for an old employment contract of Marilyn Monroe, 85,000 Americans picked up pink slips last month.

Internet giant Google (GOOG) announced its intention to get into the energy business -- here's hoping it turns out better than erstwhile energy giant Enron's escapade into the Internet business. Cold weather caused OJ to run away and Henry Blodget, no stranger to incriminatory emails, took Tiny Tim to task after the Treasury Secretary's injudicious epistles on AIG (AIG) emerged. It's all quiet in economics but when Alcoa (AA) unofficially opens fourth quarter reporting season this afternoon it may mark the beginning of the end of an earnings recession dating back to 2007.

Initiations

Republic Services (RSG): Morgan Stanley starts Republic Services at an Overweight.

Rick's Cabaret (RICK): The stock is begun with a Buy and $14 price objective at Brean Murray based on an appealing business model and strong free cash flow.

Hanesbrands (HBI): Hanes gets picked up at a Buy and $32 target, also at Brean Murray, as a long term restructuring effort is paying off.

Fossil (FOSL): Brean Murray's been busy, also finding time to initiate Fossil at a Buy ($41 target) as the watchmaker is well placed to take advantage of an improving international economy.

Miscellaneous: UBS begins the week in a benevolent mood, raising ratings on McAfee (MFE), Talbots (TLB), and Scripps Networks Interactive (SNI) (all now Buy from Neutral).

Cloud Peak Energy (CLD): The stock is up where the air is rare after an Outperform ($21 price objective) initiation at Credit Suisse, which says the best time to buy a metals/mining company is invariably when inventories are high and prices low.

Upgrades

Intel (INTC): The chipmaker is upgraded to Hold from Sell at Auriga, which also takes its target up $3 to $20 as checks suggest surprising strength in PC shipments. For more, see A Rosy Outlook for Intel.

Corning (GLW): Deutsche Bank boosts Corning to Buy from Hold and increases its target price to $24 from $19 as the firm believes Street estimates will trend higher in light of robust TV/PC demand and tight capacity in 2010.

Restaurants: Panera Bread (PNRA) and Chipotle Mexican Grill (CMG) are both also raised to Buy from Hold by Deutsche Bank.

Oil Stocks: With oil futures at 15-month highs as I write, Citigroup takes Chevron (CVX) ($97 target) and BP Plc (BP) each to Buy from Hold. See also Crude Oil Emerges As Commodity Leader -- For Now.

Barclays (BCS): The financial stock is being boosted to Buy from Hold, also at Citi.

Seagate Technology (STX): The stock should be able to keep its head above water after being boosted to Buy from Hold at Argus, which sets a target of $25. The broker sees strong demand this year for PC disk drives.

Arch Coal (ACI): The coal stock which also attracted positive analyst comments last week, is showing strength ahead of the open after being increased to Overweight from Underweight at Morgan Stanley. For more, see Two Ways to Play: Lump of Coal for Christmas.

Allegheny Technologies (ATI): Bank of America/Merrill Lynch increases Allegheny Technologies to Neutral from Underperform.

Lam Research (LRCX): The stock is boosted to Buy from Neutral at UBS.

Convergys (CVG): CVG is added to Top Picks Live list at Citigroup as its call center volumes should benefit from better-than-expected consumer spending patterns and easier comps.

SunPower (SPWRA): The solar stock is upped to Buy from Hold by Societe Generale.

Suntech (STP): STP is moved to Neutral from Underperform at Macquarie.

Regal Entertainment (RGC): Thomas Weisel takes Regal Entertainment to Overweight from Market Weight.

Downgrades

Walt Disney (DIS): Dow component Walt Disney is lowered to Neutral from Buy at Janney Montgomery Scott.

Procter & Gamble (PG): The stock is downgraded to Market Perform from Outperform at BMO Capital Markets.

Burger King (BKC): Deutsche Bank downgrades Burger King (Hold from Buy) and lowers its target to $19 from $22 as the broker believes January comps have been soft.

Northern Trust (NTRS): The stock could head south after getting a Neutral from Buy downgrade at Goldman.

Northeast Utilities (NU): As indeed may Northeast Utilities, taken to Neutral from Buy by UBS.

Qwest (Q): The stock is cut to Market Perform from Outperform at Raymond James.

RTI International Metals (RTI): RTI is now Neutral from Outperform at Cowen.

Ryanair (RYAAY): Royal Bank of Scotland reduces Ryanair to Hold from Buy.
No positions in stocks mentioned.
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