United Parcel Service (UPS), which I first wrote about here on April 7, 2009 at a price of $51.28, has corrected in mid-2010, roughly in-sync with the Dow's recent retreat. But one could make the case that the $11 drop from highs near $71 earlier this spring is a bit much, and needless to add I still like the shares here.

Look for UPS'a 2010 revenue to increase 8-10% after a difficult 2009. Without question, the worst is over for the delivery business and better quarters are ahead: increased pricing power, in some delivery segments, and higher volumes will ensue in the quarters ahead.

Analyst Upgrades

• UBS upgraded UPS (UPS) and FedEx (FDX) to buy from hold based on recent weakness and leverage to a recovery. The firm raised its price target on UPS to $74 from $72 and on FedEx to $100 from $97.
• Bernstein upgraded Medicis (MRX) to outperform from market perform based on valuation and said the company has been executing well over the past few months. The firm has a $28 price target on the stock.
• Citigroup upgraded Weingarten Realty (WRI) to buy from hold, citing valuation and the company's improved balance sheet. The firm maintains a $24 price target for shares.
• Home Depot (HD) and Lowe's (LOW) were upgraded to market perform from underperform at BMO Capital.
• NextEra Energy (NEE) was upgraded to outperform from neutral at Baird.
• Nokia (NOK) was upgraded to neutral from reduce at WestLB.

FedEx (FDX), a package delivery service operating in the same industry as United Parcel Service (UPS), is experiencing something of a disconnect between its earnings report and its stock performance. I'm writing this early in the trading session, so things could change later on, but my screen is currently showing a quote of $80.77 for FedEx, which means the equity is down 2.7%. Volume should be robust by the end of the day.

According to this article, the company made $1.33 per share. This was more than double the adjusted profit that was reported in the year-ago frame, and it was a penny better than analyst projections. What gives?

You would think with the Dow falling nearly 400 points Thursday that all the news would be doom and gloom. But it appears one analyst still sees strength in the underlying economy that could provide some hope for Wall Street.

David Ross, an analyst at Stifel Nicolaus, upgraded two bellwether stocks Thursday morning: United Parcel Service (UPS) and FedEx (FDX).

Ross upgraded both stocks from a hold to a buy, citing improved operating efficiencies and the likelihood of a continued economic recovery.

Analyst Upgrades

• Wells Fargo upgraded Home Properties (HME) to outperform from market perform. The firm thinks that rental rate in the Northeast and mid-Atlantic are poised to increase, while Home Properties provides relatively cheap access to these markets.
• Deutsche Bank upgraded VeriSign (VRSN) to buy from hold after the company sold its authentication business to Symantec (SYMC). The firm upped its target for VRSN shares to $35 from $25.
• Macquarie upgraded Nexen (NXY) to outperform from neutral following the company's divestiture of its noncore heavy-oil properties in Western Canada.
• UPS (UPS) was upgraded to buy from hold at Stifel Nicolaus.
• Dell (DELL) was upgraded to buy from hold at Standpoint Research.
• Emerson Electric (EMR) was upgraded to outperform from market perform at Bernstein.

Here are some highlights from this past week's earnings coverage on BloggingStocks:

• Coinstar Inc. (CSTR) shares surged following stronger-than-expected Q1 earnings driven by DVD rentals.
• Humana Inc. (HUM) shares traded lower despite the report of better-than-expected earnings for Q1.
• IMAX Corp. (IMAX) reported strong Q1 results that easily topped consensus estimates, but shares declined.
• Kellogg Co. (K) topped Q1 earnings expectations and announced a share buyback program.
• Office Depot Inc. (ODP) Q1 earnings fell short of consensus estimates and same-store sales declined.

If you're an investor in United Parcel Service (UPS) or an investor at-large, you have to like UPS's first quarter, during which the bellwether company earned 71 cents per share (excluding one-time items), well above the Thomson/Reuters First Call first quarter consensus estimate of 58 cents.

UPS also confirmed its 2010 earnings guidance of $3.05 to $3.30 per share, compared to the First Call estimate of $3.16. Those surveyed by First Call also expect UPS to earn $3.79 in 2011. UPS earned 52 cents per share a year ago, in the first quarter of 2009.

U.S. stock futures declined Tuesday morning, following world markets as concerns over Greece debt problems heightened again. On Wall Street, investors prepared for the Federal Reserve two-day policy meeting that's beginning today and a Goldman Sachs hearing in front of a U.S. Senate committee. And as more earnings were digested, investors awaited some economic data due out this morning.

Overseas, world markets mostly fell amid mounting concerns about the Greece's ability to tap a bailout facility as Germany demanded new austerity measures first. There were also fears that Chinese authorities were preparing measures to cool down the economy and stocks in Shanghai dropped sharply.

Here are some highlights from this past week's earnings coverage on BloggingStocks:

• Advanced Micro Devices Inc. (AMD) shares declined despite better-than-expected Q1 results due to profit taking.
• Alcoa Inc. (AA) reported a decline in revenue and earnings in line with expectations, leading to a sell off of shares.
• Bank of America Corp. (BAC) Q1 earnings results beat consensus estimates but shares fell on other news.
• General Electric Co. (GE) posted better-than-expected earnings but said revenue declined in the first quarter.
• Google Inc. (GOOG) Q1 earnings and revenue topped expectations but a surge in expenses sent shares lower.

Still doubt the sustainability of the U.S. economic recovery? That's understandable, given the length and depth of the recession, and the many transgressions and policy errors that got us into this protracted slump.

But, from where I sit, the economic expansion is real and strengthening, and here are two more data points to support this thesis:

• Intel (INTC), which Tuesday reported impressive first quarter earnings, and equally significant, said it saw strength in the growth of microchips that power business servers -- which indicates that corporate technology spending is moving higher.

UPS (UPS - option chain) shares are rising today after the company preliminary earnings last night, posting an adjusted first-quarter profit of 71 cents per share, which topped analysts' forecasts of 58 cents per share. UPS also lifted its full-year EPS forecast to a range of $3.05 to $3.30, up from a previous range of $2.70 to $3.05. Analysts had forecast full-year EPS of $2.95. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on UPS.

UPS opened this morning at $68.50. So far today the stock has hit a low of $68.38 and a high of $69.74. As of 12:05, UPS is trading at $69.07 up $3.62 (5.5%). The chart for UPS looks bullish and S&P gives UPS a positive 4 STARS (out of 5) buy ranking.

Analyst Upgrades

• Piper Jaffray upgraded UPS (UPS) to overweight from neutral with a $79 price target following the company's better-than-expected Q1 results.
• SunTrust believs Zions Bancorp's (ZION) tangible book value is around $20/share, making any future capital raise not as dilutive as the firm previously expected. The firm upgraded shares to buy from neutral and has a $26 target on the stock.
• FBR Capital upgraded J.B. Hunt (JBHT) to outperform from market perform following the company's better-than-expected Q1 results. The firm raised its target price for shares to $43 from $40.
• American Superconductor (AMSC) was upgraded to buy from hold at Deutsche Bank.
• BP (BP) was upgraded to outperform from neutral at Credit Suisse.
• Global Payments (GPN) was upgraded to outperform from market perform at Wells Fargo.

U.S. stock futures edged lower Thursday morning following Wednesday's rally as investors awaited economic data on employment and manufacturing. Even with UPS's (UPS) surprisingly strong results and outlook, and China's strong economic growth, investors decided it prudent to take a step back following five straight days of gains.

If Wednesday's rally was fueled by strong results from Intel (INTC) and JPMorgan Chase (JPM), Thursday is all about economic data. Already, RealtyTrac reported a record number of U.S. homes foreclosed in the first three months of this year. Foreclosures jumped 35% in the first quarter from a year ago. In addition, households facing foreclosure grew 16% in the same period. This, the report says, is a sign banks are starting to wade through the backlog of troubled home loans at a faster pace.

This may be your last chance to purchase shares of United Parcel Service (UPS), first discussed here on April 7, 2009 at a price of $51.28, and earn an outsized gain during the current economic expansion.

Without question, the worst is over for the delivery business and better quarters are ahead: increased pricing power, in some delivery segments, and higher volumes will ensue in the quarters ahead, as the U.S./global economic recoveries strengthen. Look for UPS's 2010 revenue to increase 8-10% after a difficult 2009.

The stock market tried to make a comeback several times today, but the indexes closed down sharply on the day. We did not even have Washington D.C. open to bash the financial markets, but we had continued concern that banks were ceasing to trade with some emerging market banks that are in the nations of the PIIGS (Portugal, Italy, Ireland, Greece and Spain).

Here were today's closing bell levels:

Dow 9,908.39 -103.84 (-1.04%)
S&P 500 1,056.75 -9.44 (-0.89%)
Nasdaq 2,126.05 -15.07 (-0.70%)

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