• Citigroup upgraded MEMC Electronic (NYSE: WFR) to Buy from Hold after channel checks indicated solar poly price pressures are easing. The firm added MEMC to its Top Picks Live list and raised its price target on shares to $24 from $15.
  
• FBR Capital upgraded PHH Corp (NYSE: PHH) to Outperform from Market Perform to reflect an improvement in mortgage banking fundamentals and recent management changes at the company. The firm raised its target on shares to $23 from $13.
  
• Deutsche Bank upgraded PerkinElmer (NYSE: PKI) to Hold from Sell on valuation, seeing a balanced risk/reward at current levels. The firm raised its target on shares to $19 from $14.
• Pearson plc (NYSE: PSO) was upgraded to Outperform from Neutral at Credit Suisse.
  
• Dell (NASDAQ: DELL) was upgraded to Conviction Buy from Neutral at Goldman.
  
• Nymagic (NYSE: NYM) was upgraded to Market Perform from Underperform at Keefe Bruyette.

• Keefe Bruyette upgraded MF Global (NYSE: MF) to Outperform from Market Perform as it believes the company's liquidity position has improved and that it is well positioned to take market share. The firm raised its target on shares to $9.
  
• UBS upgraded Wynn Resorts (NASDAQ: WYNN) to Buy from Neutral and raised its target to $33 from $28 citing better than expected performance in Macau, valuation, and comfort with the balance sheet.
  
• Citigroup upgraded Brandywine Realty (NYSE: BDN) to Buy from Hold on valuation and believes progress on asset sales or financing could drive significant upside. The firm keeps a $4.50 price target on BDN.
• Joy Global (NASDAQ: JOYG) was raised to Neutral from Underweight at JP Morgan.
  
• Novo Nordisk (NYSE: NVO) was lifted to Hold from Sell at Societe Generale.
  
• Cimarex Energy (NYSE: XEC) was upgraded at Banc of America/Merrill to Buy from Underperform.

The FDIC took over three more banks yesterday bringing the total number of bank failures so far this year to nine. As I posted, the FDIC likes to close banks on Friday after hours so they can reopen as branches of the acquiring bank on the following Monday morning. It remains to be seen whether the FDIC has enough money in its deposit insurance fund to handle its obligations for 2009 and beyond.

As it did last year, the FDIC is closing small banks while the Treasury and the Fed continue to keep the very largest ones from collapsing under the weight of their bad assets. On Friday, regulators closed banks in Georgia and California including:

Analyst upgrades:

• Friedman Billings upgraded Synovus (NYSE: SNV) to Market Perform from Underperform on valuation following the recent weakness. BASF (OTC: BASFY) and Akzo Nobel (OTC: AKZOY) were upgraded to Buy from Neutral at UBS on valuation and believes cash flows can cover the company's dividend.
• JP Morgan upgraded H.B. Fuller (NYSE: FUL) to Overweight from Neutral citing benefits from lower raw material costs.
• CA, Inc (NASDAQ: CA) was added to Goldman's Conviction Buy List.
• Goldman removed Boeing (NYSE: BA) from the Conviction Sell List.
• WABCO Holdings (NYSE: WBC) was upgraded to Buy from Hold at KeyBanc.

• Oppenheimer downgraded Giant Interactive (NYSE: GA) to Perform from Outperform following the company's Q3 results as they believe a recovery of revenue from ZT Online will take longer than expected.
• Friedman Billings cut Walter Industries (NYSE: WLT) to Market Perform from Outperform as they believe the decline in steel demand will pressure met coal prices. The company's target was lowered to $30 from $53.
• Citigroup downgraded shares of Atlas Pipeline (NYSE: AHD) Holdings to Sell from Hold as they believe the company could potentially be in violation of its debt covenants as early as Q1. The company's target was lowered to $4 from $31.
• Oracle (NASDAQ: ORCL) was removed from Goldman's Conviction Buy List.
• Dover (NYSE: DOV) and Emerson Electric (NYSE: EMR) were downgraded to Underweight from Neutral at JP Morgan.

• Lowe's Companies (NYSE: LOW) to report Q1 earnings; conference call scheduled for 9:00am.
• Campbell Soup Company (NYSE: CPB) to report Q3 earnings; Conference call scheduled for 10:00am.

• Senate Judiciary Committee Hearing on Global Internet Freedom & Corporate Responsibilty at 10:00am. Appearing: Google, Inc. (NASDAQ: GOOG), Cisco Systems, Inc. (NASDAQ: CSCO) and Yahoo! Inc. (NASDAQ: YHOO).
• Medtronic, Inc. (NYSE: MDT) to report Q4 earnings; conference call scheduled for 8:00am.
• Hewlett-Packard Company (NYSE: HPQ) to report Q2 earnings; conference call scheduled for 5:00pm.

CA, Inc. (NYSE: CA) provides information technology (IT) management software. Its programs manage network databases, applications, storage functions and security options, operating across distributed computing environments. The firm also provides technical support and consulting services. CA has strategic relationships with Google (NASDAQ: GOOG), IBM (NYSE: IBM), Microsoft (NASDAQ: MSFT) and other IT market leaders. It is one of the world's largest software companies.

CA surprised the Street late last month, with fiscal Q3 EPS of 36 cents and revenues of $1.1 billion. Analysts had been expecting 25 cents and $1.04 billion. Management also guided FY08 EPS to $1.22-$1.26 ($1.09 consensus) and FY08 revenues to $4.25-$4.28 billion ($4.19B consensus).

Callaway Golf (NYSE: ELY) is scheduled to release Q4 EPS this afternoon.

ELY will hold an analyst meeting on February 7.

ELY overall option implied volatility of 50 is above its 26-week average of 41 according to Track Data, suggesting larger risk.

CA, Inc. (NYSE: CA), an information technology management software company, closed at $22.30 Wednesday.

Stanford Group initiated CA with a Hold rating. Stanford says: "In our opinion CA has suffered from three main problems in recent years; growth, restructuring-related disruptions, and a complex financial model that hindered visibility of its financial performance."

CA is expected to report Q3 EPS after the market close tonight. CA February option implied volatility of 43 is above its 26-week average of 28 according to Track Data, suggesting larger price risks.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

• Lowe's Companies Inc (NYSE: LOW) to report Q2 earnings; conference call at 9am.
• PDUFA Date for Sciele Pharmaceutical Inc's (NASDAQ: SCRX) LCP-FenoChol(Fenofibrate) for adjunctive therapy to diet for treatment of hypertriglyceridemia and hypercholesterolemia.

• Staples Inc (NASDAQ: SPLS) to report Q2 earnings; conference call at 8am.
• Target Corporation (NYSE: TGT) to report Q2 earnings; conference call at 10:30am.

• CA Incorporated (NYSE: CA) annual meeting of stockholders at 10am.
• Abercrombie & Fitch Co (NYSE: ANF) to report Q2 earnings; conference call at 4:30pm.
• Richmond Federal Bank President Lacker to speak at 12:30pm in Charlotte, NC about the U.S. Economic Outlook.

• Constellation Energy Group Inc (NYSE: CEG) analyst meeting at 2pm.
• Gap Inc (NYSE: GPS) to report Q2 earnings; conference call at 5pm.

• H.J. Heinz Company (NYSE: HNZ) to report Q1 earnings; conference call at 8:30am.
• PDUFA Date for IDM Pharmaceutical Inc's (NASDAQ: IDMI) MTP-PE (Mifamurtide), formerly Junovan, newly diagnosed resectable high grade osteosarcoma (bone cancer) in combination with chemotherapies.

MOST NOTEWORTHY:

• Nollenberger believes the Hardee's franchise is entering a period of accelerated growth and initiated shares of CKE Restaurants (NYSE: CKR) with a Buy rating and $27 target.

• Goldman views Cardinal Health (NYSE: CAH) as a as a high quality, focused franchise with strong fundamental outlook driven by margin expansion and improvements in non-drug wholesale businesses and restructuring efforts, reinstating its Buy rating on the company.

• American Technology initiated eBAY Inc (NASDAQ: EBAY) with a Buy rating and $43 target, believing the company is the top play on growth of U.S. e-commerce and they expect upside to numbers tonight.

• Needham believes CA Inc (NYSE: CA) Inc remains in transition as it continues to work on the repackaging of its vast product array into five solution sets and started the company with a Hold rating.

• Lazard initiated F5 Networks Inc (NASDAQ: FFIV) with a Buy rating and $100 target.

• Citigroup started Clearwire Corp (NASDAQ: CLWR) with a Hold rating and $23 target.

• Morgan Stanley assumed coverage of Vornado RealtyTrust (NYSE: VNO) with an Equal Weight rating.

• SourceFire Inc (NASDAQ: FIRE) was initiated with a Hold rating and $12 target.

• The Wet Seal (NASDAQ: WTSLA) was initiated with an Outperform rating at Cowen.

• Roth Capital initiated shares of Vivus Inc (NASDAQ: VVUS) with a Buy rating and $15 target.

CA Inc. (NYSE: CA), the software company formerly known as Computer Associates, last week began to speak out against founder Charles Wang about two years too late.

Under Wang's leadership, Computer Associates developed a reputation for accounting shenanigans, shoddy customer service and obscenely high executive compensation, which is why a special board committee urged CA to try and recoup some of Wang's pay. The company should take the advice.

Wang, who also owns the New York Islanders, has denied any wrongdoing. The New York Times reported that he blames CA's problems on his successor Sanjay Kumar, one of many company executives who pled guilty to securities fraud following a federal investigation.

Considering how close the two men were and Wang's autocratic management style, Wang's denials are hard to believe. If this fight goes to court, this will get nasty very quickly. CA has tried for years to undo the damage done by Wang and his associates. The New York Times pointed that the company has had to spend $500 million on fines ad internal investigations.

MOST NOTEWORTHY:

• Adobe Systems Inc (NASDAQ: ADBE) was initiated with an Outperform rating and $47 target at Credit Suisse. The firm said Adobe is one of the best-positioned large-cap software companies given its leading position in digital media and growing presence in enterprise mobile and Web 2.0 markets.

• CA Inc (NYSE: CA) was initiated with a Hold rating and $27 target at Jefferies. While CA is being looked at by private-equity players, Jefferies believes shares are richly valued.

• DSW Inc (NYSE: DSW) was initiated with a Sell rating and $30 target at Wedbush, as they believe the consensus' 3-5 year annual EPS growth rate of 20% to be too high.

• Credit Suisse started Southern Union Co (NYSE: SUG) with an Outperform rating and $33 target.

• Needham assumed coverage of Ikanos Communications Inc (NASDAQ: IKAN) with a Hold rating, as the firm believes a rebound of VDSL spending is unlikely until the second-half of 2007.

• Morgan Joseph is positive on Denny's Corp (NASDAQ: DENN) improving operations and started the food retailer with a Buy rating and $7 target.

• Jefferies started HMS Holdings Corp (NASDAQ: HMSY) with a Buy rating and $25 target. The firm believes HMS Holdings is positioned to serve the needs of government healthcare programs.

• Credit Suisse initiated WebEx Communications Inc (NASDAQ: WEBX) with a Neutral rating at $50 target based on valuation.

Traditionally, private equity firms have focused on brick-and-mortar companies. The targets are often underperforming – yet have strong cash flows and stable contracts.

But, recently, private equity firms have moved to tech companies. And some of the deals have been huge, such as the $17.6 billion buyout of Freescale Semiconductor, Inc. (NYSE:FSL) and the $11.4 billion Sungard buyout.

So, is this the beginning of a major trend?

The answer is "no" from a top credit analysis firm, Fitch Ratings.

Why?

First, tech companies are not ideal for loading-up the balance sheet with debt. That is, the free cash flow tends to be too low – or too erratic. Besides, there is "technology risk," in which a company's products can become obsolete from intense competitive forces.

Next, because of the dot-com implosion, many tech companies have already restructured operations. In other words, there is little opportunity for improvement that a private equity can provide.

Despite all this, Fitch did find a few attractive candidates for buyouts: CA, Inc. (NYSE:CA), Convergys Corporation (NYSE:CVG) and even Dell Inc. (NASDAQ:DELL).

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Financial Statements.

Sanjay Kumar, a young guy at 44-years-old, will now spend the next 12 years in prison.

While CEO of CA, Inc. (NYSE:CA), Kumar got too loosey-goosey with the accounting, so much that the company had to change its name because of the bad publicity. Originally, the company was called Computer Associates. In all, the fraud amounted to about $2.2 billion in misrepresentations.

Kumar's shenanigans were quite creative, actually. For example, he had the concept of a 35-day month. This is always useful to squeeze in more sales. There was also backdating of contracts (i.e., if the month was not long enough).

The irony is that CA is a leader in software to help companies deal with things like, well, accounting and disclosures. Hey, who better to know how to make magic with the financials?

True, 12 years is a long time, but Kumar will still be young when he gets out of prison. Besides, his fine is a mere $8 million.

In fact, because of his crimes, Kumar could have received a life sentence. I guess the judge thinks $2.2 billion is kind of a small number.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates InvestorOffering.com.