Piper upgraded Intel (NASDAQ: INTC) to Buy from Neutral to reflect the company's strong competitive position and low valuation. The firm does not expect Intel to miss Q3 estimates.
Goldman upgraded shares of Deutsche Telecom (NYSE: DT) to Buy from Neutral and added the stock to the Conviction Buy List as they believe the dividend is well covered.
Wachovia upgraded Landstar System (NASDAQ: LSTR) to Outperform from Market Perform on valuation and potential near-term catalysts from hurricane-related activities.
Abercrombie & Fitch (NYSE: ANF) was raised to Outperform from Market Perform at Friedman Billings.
Research in Motion (NASDAQ: RIMM) was upgraded at JMP Securities to Outperform from Market Perform.
Baird lifted Wells Fargo (NYSE: WFC) to Neutral from Underperform.
Analyst downgrades:
Jefferies downgraded VCA Antech (NASDAQ: WOOF) to Underperform from Buy as they believe reduced consumer spending and rising unemployment levels will hurt the company's hospital and lab volumes in FY09. The company's target was lowered to $25 from $35.
Oppenheimer downgraded shares of Total System (NYSE: TSS) to Perform from Outperform to reflect the challenging macro environment and the customer portfolio risk from bank consolidation.
Goldman upgraded shares of BP Plc (NYSE: BP) to Buy from Neutral on valuation as they believe the recent pullback provides an attractive entry point.
VF Corp. (NYSE: VFC) was raised to Outperform from Neutral at Credit Suisse citing its acquisition platform and international growth. The company's target was increased to $100 from $88.
Deutsche Bank upgraded shares of Tenet Healthcare (NYSE: THC) to Buy from Hold and increased its target to $8.50 from $7 to reflect increased confidence in the company's ability to beat expectations over the next 12 months and reduce its net debt.
US Steel (NYSE: X) was raised to Sector Outperformer from Sector Performer at CIBC.
I know it doesn't matter at all. Right now we are so stuck on the banking problems and on the companies bleeding from higher energy prices that nobody cares about all of this cash, which will be used to shrink equity. They won't care because the banks, brokers and homebuilders, and the hobbled companies that use oil, have to issue so much equity that you can't see the effect of the equity shrinkage. But it will eventually matter. It has to matter that Deere has taken out 10% of its stock in the last four years. It does matter that Black & Decker (NYSE: BDK) (Cramer's Take) has eliminated almost 20% of its equity. Emerson's taken out 5%, same with Boeing (NYSE: BA) (Cramer's Take). There's just a huge amount of equity being shrunk.
"Dividend growth has become increasingly scarce on Wall Street," says says Chuck Carlson, an expert on dividend reinvestment plans. In his The DRIP Investor he looks at two stocks boosting their payouts.
"For the first time in five years, the number of companies in 2007 boosting their dividends declined nearly 6% from the previous year, according to Standard & Poor's. And the slowdown in dividend growth continued in the first quarter of 2008.
"The first quarter marked the seventh consecutive three-month period of year-over-year declines in the number of companies raising dividends. Through the first three months of this year, 19% fewer companies raised dividends than in the year-earlier quarter.
"Even more alarming, 83 companies decreased their dividends during the fi rst quarter, according to S&P. That's up from just 19 in the same period in 2007 and is the highest number of dividend decreases since 1991.
"Nevertheless, there are still plenty of companies willing to boost their dividends, and you can now buy such companies at bargain prices.
TheStreet.com's Jim Cramer says there are problems, but nothing looks dire.
The setup is pretty good here. We've got a mildly oversold market with lots of June money expected to come in as CDs roll over and people realize that the cash rates are so bad. We have no earnings news, which is good, given that unless you do a lot of business overseas without a lot of raw cost escalation (think everything from Emerson (NYSE: EMR) (Cramer's Take) to Heinz (NYSE: HNZ) (Cramer's Take)) or you transport or mine oil, minerals and agricultural goodies, you aren't doing all that well.
We have the possibility of some stability in energy, as $130 has been difficult to punch through, even though we have not been able to build any inventories yet despite all we hear about how people are driving less. And the expectations for the employment number are so weak that if we get any job creation we are going to begin to hear that maybe the economy is on the mend.
Again, that's considered antithetical given the sinking home price/escalating food and oil price one-two punch. But, as I said last week, there is a finite nature to the bad loans.
TheStreet.com's Jim Cramer says lots of companies now thrive with crude up here.
Oil's not a tax on everything -- it's a tax on the consumer. That's what I come down to when I see the charts this weekend and ponder what's happening in so much of industrial America.
Company after company that I examine -- the new techs, as I call them -- actually benefit from higher oil prices. Or they can pass them on with ease, because of the worldwide demand being so strong.
Take all of the companies involved with making a Boeing (NYSE: BA) (Cramer's Take): Boeing itself, Alcoa (NYSE: AA) (Cramer's Take), Honeywell (NYSE: HON) (Cramer's Take) and Precision Castparts (NYSE: PCP) (Cramer's Take) being good examples. Each of these is necessary because the new Dreamliner burns lots less fuel, and with fuel the biggest airline cost, it stands to reason that higher energy prices make the plane more desirable even at a higher price point.
Readers of this space know that the investment bias is toward large-cap companies with demonstrated business models and who have a competitive advantage in established markets, preferably with a favorable global trend as a support. And with the above in mind, Emerson Electric is worth a review.
Emerson Electric Co. (NYSE: EMR) is an industrial conglomerate that operates more than 60 diverse businesses in five business segments: process management, industrial automation, network power, climate technologies, and appliance/tools.
In general, analysts expect Emerson's FY 2008 revenue to increase 10-12% on solid performances from its network power and process management segments.
All of them, what do they have in common? They have left the U.S. behind. We are an afterthought. If you can prove on a conference call that Ben Bernanke has nothing to do with your book of business, you are going higher.
Notice Eaton (NYSE: ETN) (Cramer's Take) and Emerson (NYSE: EMR) (Cramer's Take). They can't quit. When the coal operators come to their sense and realize that they can make fortunes digging for more, then Joy Global will take out the high. I am using any weakness to buy Foster Wheeler (NASDAQ: FWLT) (Cramer's Take), the tug of the non-U.S. cyclicals is that strong.
MOST NOTEWORTHY: Comcast, ING Group, Allianz AG and Fannie Mae were today's noteworthy downgrades:
Goldman downgraded Comcast Corp. (NASDAQ: CMCSA) to Neutral from Buy following the company's reduced 2007 guidance.
Merrill downgraded shares of ING Group (NYSE: ING) and Allianz AG (NYSE: AZ) to Neutral from Buy to reflect their more cautious view on the sector due to subprime mortgages spreads.
Piper lowered its rating on Fannie Mae (NYSE: FNM) to Neutral from Buy due to the lack of visibility regarding when credit losses will peak. Credit Suisse downgraded shares to Underperform from Neutral.
Emerson Electric Company (NYSE: EMR) is a diversified technology firm, providing electrical products and engineering services to industrial, commercial and consumer markets. Products include motors, appliances, tools and monitoring devices for controlling industrial plant operations, providing commercial and residential power and environmental control, and operating commercial refrigeration units. Competitors include General Electric (NYSE: GE) and Hitachi (NYSE: HIT).
The company pleased investors earlier in the month, when it reported fiscal Q4 EPS of 78 cents and revenues of $6.13 million. Analysts had been expecting 75 cents and $6.04 billion. Management also guided FY08 EPS to about $2.93-3.06 ($2.98 consensus) and FY08 revenues to about $24.15-24.83 billion ($24.03B consensus).
MOST NOTEWORTHY: Wal-Mart Stores, Magna International, EchoStar Communications, Westell Technologies and SiRF Technology were today's noteworthy upgrades:
Rochdale upgraded shares of Wal-Mart Stores (NYSE: WMT) to Buy from Hold citing improved outlook for margins and ROIC.
CIBC World Markets resumed coverage and upgraded shares of Magna International (NYSE: MGA) to Sector Outperformer from Sector Performer as they believe higher multiples are warranted due to the company's improving earnings power and cash flow generation.
Oppenheimer upgraded shares of EchoStar Communications (NASDAQ: DISH) to Buy from Neutral as they believe recent events add $4-$6 per share to their valuation analysis.
Westell Technologies (NASDAQ: WSTL) was upgraded to Outperform from Neutral at Baird. The firm believes Westell is taking the right steps to improve its market position and financial performance.
Credit Suisse upgraded SiRF Technology Holdings (NASDAQ: SIRF) to Outperform from Neutral, expecting the stock to benefit from a strong holiday season at electronic retailers.
When Warren Buffett announced he wanted to use between $40 and $60 billion to buy a company several days ago, picking a target for the billionairest of all billionaires became the favorite pastime of financial writers everywhere -- and our bloggers were as eager as anyone else to come up with just the thing for the guy who already has everything (and everything, in this case, includes bunches of shares of companies as diverse as dull sheetrock manufacturerUSG Corp. (NYSE: USG) to hip shoe companyNike Inc. (NYSE: NKE)).
Of course, Buffett's needs are unique. First of all, the company has to be both big and a good value -- no 80x P/E multiples for Warren. It has to be a relatively simple business (I'm thinking nanotech is out), have a good management team and no dark and dirty secrets (so sub-prime lenders are probably off the list). Finally, the company should have solid, long-term competitive advantages.
Sheldon Liber suggests a couple that might make the grade: Allstate Corp. (NYSE: ALL), the insurance company, which at about $38 billion in market capitalization and a 7.8x P/E ratio fits both the "big" and "cheap" qualifiers. Plus, we all know that Warren Buffett loves insurance companies, and given its retail approach, it's not much of a competitor with longterm portfolio company GEICO. Emerson Electric (NYSE: EMR) also seems a good candidate with its $37 billion market cap and 19x P/E ratio -- but is it simple enough? Its business is, according to Hoover's, making "a host of electrical, electromechanical, and electronic products, many of which are used to control gases, liquids, and electricity." Hmmm.
When Gary Sattler suggests Warren might buy General Electric Co. (NYSE: GE)'s plastics division, it's a good concept (simple, well-managed) but the price is way too low at around $10-12 billion. A commenter, however, brings up a good replacement in Lowe's Companies Inc. (NYSE: LOW); it has a $47 billion market cap and a reasonable P/E ratio of 15.5x. What's more, it has none of the bad-management baggage of competitor Home Depot Inc. (NYSE: HD). Does it have a "moat," though? I suppose that's a question for Warren. He does own some of each company, meaning that he's already emotionally invested in the sector (a plus) although it's obvious from our near-tie in the Battle of the Brands that neither holds a substantial consumer-facing edge competitively.
Chuck Carlson is the newsletter industry leader in DRIPs, or dividend reinvestment plans. Not surprisingly, then, his newsletter is called The DRIP Investor.
For those unfamiliar with these programs, DRIPs are dividend reinvestment plans, which are set up by companies to make it easier and more cost-effective for individual investors to buy and accumulate long-term positions by reinvesting dividends back into additional shares.
Usually, the commissions and other related costs of DRIPs are low, and in some cases, free. Says Carlson, "All things equal, a DRIP with no fees is better than one that charges fees."
He continues, "To be sure, I'm not suggesting investors should automatically discard a DRIP because it charges fees. Still, fees erode investment returns, so taking fees into account in your selection process makes sense."
To help investors find the most cost-effective way of building portfolios, the advisor has conducted a review of "fee-free" plans. Using a proprietary system that ranks 5,000 stocks based on over 100 metrics, he has developed a "starter portfolio" for those with limited investment funds. Such a starter portfolio, he notes, could be developed with as little as $1,000 to start.
He notes, "If I were constructing a reasonably diversified starter portfolio of six "fee-free" stocks, I would focus on the following issues:
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Analyst upgrades:
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When Warren Buffett 
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