Analyst upgrades:
- Credit Suisse upgraded Hewlett-Packard (NYSE: HPQ) to Outperform from Neutral and raised its target to $55 from $44 based on earnings momentum and a bottom in the Imaging and Printing segment. Note that Dell was downgraded to Neutral from Outperform.
- Jefferies upgraded Covance (NYSE: CVD) to Buy from Hold as it believes investor expectations are more reasonable following the company's conference presentation and that its Late Stage segment should continue to post strong results. The firm raised its target on shares to $65 from $5.
- Stephens upgraded Home Bancshares (NASDAQ: HOMB) to Overweight from Equal Weight to reflect improved capital levels and a better-than-expected near-term outlook. The firm raised its target on shares to $27 from $24.
- Citigroup upgraded Macy's (NYSE: M) to Buy from Hold after meeting with management as it believes the My Macy's localization is gaining traction. The firm raised its target on shares to $30 from $15.
- Gymboree (NASDAQ: GYMB) was upgraded to Outperform from Market Perform at FBR Capital.
- DISH Network (NASDAQ: DISH) was upgraded to Outperform from Market Perform at Wells Fargo.
- Baytex Energy (NYSE: BTE) was upgraded to Sector Outperformer from Sector Performer at CIBC.
Analyst downgrades:
- Jefferies downgraded Perot Systems (NYSE: PER) to Hold from Buy following the acquisition by Dell as it believes the chances of a higher bid are unlikely. The firm raised its target on shares to $30 from $19.
- Credit Suisse downgraded Dell (NASDAQ: DELL) to Neutral from Outperform and cut its target to $16 from $19 citing Perot integration challenges and valuation. Note that the firm upgraded Hewlett-Packard to Outperform from Neutral.
- Jesup & Lamont downgraded Rowan Companies (NYSE: RDC) to Sell from Hold to reflect valuation and its "disappointing" fleet status report. The firm has a $17 target on shares.
- Vulcan Materials (NYSE: VMC) was downgraded to Neutral from Buy at UBS.
- Gerdau AmeriSteel (NYSE: GNA) was downgraded to Underperform from Neutral at BofA/Merrill.
- SL Green Realty (NYSE: SLG) was downgraded to Underperform from Neutral at Macquarie.
Analyst initiations:
- FBR Capital believes RTI International (NYSE: RTI) is well positioned to benefit from the recovery within the commercial aerospace markets. Shares were started with an Outperform rating and $30 target.
- Automatic Data Processing (NASDAQ: ADP) was initiated with an Outperform rating by Wells Fargo. The firm predicts the company's EPS will approach low-double digit growth over the next few years.
- Wells Fargo also initiated Paychex (NASDAQ: PAYX) with an Outperform rating. The firm thinks the company is a play on the increased outsourcing of HR functions by small business.
- D.R. Horton (NYSE: DHI) was initiated with a Market Perform rating at Raymond James.
- Take-Two (NASDAQ: TTWO) was started at ThinkEquity with a Buy rating and $15 target.
- Reynolds American (NYSE: RAI) was initiated with a Hold rating at Stifel Nicolaus.
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