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Upgrades & Downgrades: Leap Wireless to Jump Today?


Wall Street ratings agencies set the tone for today's stock market.

Not for this remarkable market the defeatism of nein nein nein. No, let us instead raise a beer stein or three to the Dow (^DJI) now being back above 13,000. Quite a recovery considering its 52-week low of 10,655 came as recently as 10/3/2011, when Angela Merkel was attending Oktoberfest rather than dealing with dry cleaning bills accruing from a wobbly waiter's mishandling of its best known beverage. Volume was once again light but blue chips still finished at an almost four-year closing high after consumer confidence touched its best level in 12 months. This despite the steepest plunge since 2009 in orders for durable goods, defined as expensive items designed to last upwards of three years - appliances, machinery, marriages, that sort of thing. Well, perhaps not the latter in Kim Kardashian's case but as a longtime bull on Charmin maker Procter & Gamble (PG), she at least had the satisfaction of seeing a second analyst upgrade in two days propel the consumer products powerhouse up another 1.03%. Michigan and Arizona winner Mitt Romney completed an impressive trifecta, Bain baby Staples (SPLS) surging 4.99% ahead of this morning's well-received earnings announcement. Yet the man he vanquished also attained a measure of vindication, investors looking down their noses at college-attending snobs such as "for profit" school operator Career Education (CECO), whose 18.75% nosedive made it the single worst Nasdaq (^IXIC) stock. And this on a day Apple Inc (AAPL), founded by a man with one measly semester in a mediocre campus, hit another all time high of $535.41.

Can you keep a secret? Mr. Buffett certainly can, for ultimately money doesn't talk, it whispers. Victoria's Secret owner Limited Brands (LTD) reached an historic peak even as JP Morgan (JPM) unusually opted to reveal the mystery of where Wall Street gets its revenue. First Lady Michelle Obama, on an anti-obesity campaign for the country's children, must be tearing her hair out after healthy choice Fresh Del Monte (FDP) imploded 8.05% while Domino's Pizza (DPZ) gained 15.74%. Not to worry, Uncle Sam can always rechristen the junk food as a vegetable. And with a newly aggressive push against insider trading again on the front pages, Martha Stewart (MSO) - once sent to surely the best decorated prison cell in history for just such a crime - had the last laugh when her shares surged 5.47%. Today in economics, forecasts call for February's Chicago Purchasing Managers Index to tick up at 9:45 a.m. Eastern. Ben Bernanke begins his semiannual congressional testimony at 10:00 a.m. And the Fed's beige book of regional financial conditions comes out at 2:00 p.m. On the earnings front Caesars Entertainment (CZR), Costco (COST), Edison International (EIX), ITT Corp(ITT), Joy Global (JOY), Liz Claiborne Inc (LIZ), McDermott International (MCD), Repsol (REPYY.PK), SodaStream (SODA), Sotheby's (BID), and Staples (SPLS) are all due to report results.


Wireless stocks: A new Leap Day Neutral for Leap Wireless (LEAP), initiated with $10 target price at Nomura. Rival MetroPCS (PCS) receives an identical rating with a price objective of $13.

Energy stocks: Williams Cos (WMB) and Williams Partners (WPZ) are both begun with Overweights by Barclays, the latter with a $70 target.

Equinix (EQIX): Capstone has Buy rated coverage on EQIX.

Synageva Biopharma (GEVA): Shares get picked up at Overweight by JPMorgan.


Chevron (CVX): The Dow component is upgraded to Buy from Hold at Deutsche Bank, sending shares up before the bell.

Cablevision (CVC): Double vision for Cablevision this morning, both upgraded and downgraded. First the good news; shares get a Buy-from-Neutral boost at brokers Miller Tabak.

Cerus (CERS): CERS is raised to Outperform from Neutral at brokerage Robert W. Baird, which doubles its target to $6. Earnings guidance appears increasingly achievable.

Energy stocks: Goldman Sachs gives Neutral-from-Sell increases to NuStar Energy (NU), Enbridge Energy (EEP), and Enbridge Management (EEQ). Plains All American (PAA) gets a Buy-from-Neutral boost, and Williams Cos (WMB) is added to the Conviction Buy List.

Rowan Cos (RDC) RDC sees its recommendation raised to Buy from Neutral at Pritchard.

RWE AG (RWEOY.PK): The German electric utility giant is up in Europe this morning on the back of an Outperform-from-Neutral lift by BNP Paribas.


Aqua America (WTR): Shares are cut to Long-term Buy from Buy at brokers Hilliard Lyons after earnings.

Bank of Montreal (BMO): Macquarie moves the stock to Neutral from Outperform.

Education stocks: More bad news for the badly battered sector. Deutsche Bank downgrades Apollo Group (APOL) to Hold from Buy and slashes ITT Educational (ESI) to Sell from Hold.

Oil stocks: Marathon Oil (MRO), Murphy Oil (MUR), Canadian Natural (CNQ), and Oasis Petroleum (OAS) are all taken to Hold from Buy by Deutsche Bank.

Energy stocks: Buckeye Partners (BPL) is pulled from the Conviction Buy List at Goldman, which slashes both ONEOK Partners (OKS) and Sunoco Logistics (SXL) to Sell from Neutral and cuts Enbridge (ENB) to Neutral from Buy.

Cablevision (CVC): Now the bad news for CVC, downgraded to Neutral from Buy at Collins Stewart. The broker cites three straight quarters of near-flat to down yearly AOCF (adjusted operating cash flow) growth among the reasons for its pessimism on a stock that plunged 9.65% yesterday.

Coinstar (CSTR): The Redbox owner is trading lower ahead of the open after being cut by both JP Morgan (Neutral from Overweight) and Wedbush, which removes it from their list of Best Ideas.

Domino's Pizza (DPZ): DPZ is downgraded to Neutral from Overweight at JPMorgan due to valuation after yesterday's steep increase. Its new objective is $38.

MetroPCS (PCS): PCS is moved to Neutral from Buy at UBS.

NYSE Euronext (NYX): NYX is now Outperform from Strong Buy at Raymond James.

Western Refining (WNR): The firm is reduced to Equal Weight from Overweight at Morgan Stanley.

Ecolab (ECL): JP Morgan lowers its opinion on ECL to Neutral from Overweight.

Gain Capital (GCAP): The equity is downgraded to Market Perform from Outperform at JMP Securities.

Ironwood Pharmaceuticals (IRWD): Cantor Fitzgerald cuts it to Sell from Hold with a $10 target.

ViroPharma (VPHM): Staying in the sector, shares are now Hold from Buy at Auriga.

Vocus (VOCS): VOCS is downgraded to Neutral from Buy at Robert W. Baird amid a lack of catalysts for multiple expansion.

Thompson Creek Metals (TC): TC is taken to Hold from Buy at Dahlman Rose as development costs have risen significantly.
No positions in stocks mentioned.
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