Analyst upgrades:

• Jefferies upgraded Warner Chilcott (NASDAQ: WCRX) to Buy from Hold. The firm views Warner Chilcott's acquisition of P&G's (NYSE: PG) pharma business as a positive given its attractive product fit and purchase price.
• ThinkEquity upgraded Google (NASDAQ: GOOG) to Buy from Source of Funds and raised its target to $550 from $400. Previously, the firm thought Google Street estimates were too high and that low single-digit growth in Q2 and Q3 would cause multiple contraction. They said their thesis played out fundamentally but they were wrong on the stock. Given Q2 has past, the analyst raised estimates above consensus and expects an in-line Q3 and for shares to outperform as the economic cycle turns.
• Bernstein upgraded Diageo (NYSE: DEO) to Outperform from Market Perform and views Diageo's valuation as attractive. The firm expects 2H09 results on August 27 to mark a bottom in weakening top-line trends.
• Costco (NASDAQ: COST) was upgraded to Market Perform from Underperform at William Blair.
• Lowe's (NYSE: LOW) was upgraded to Overweight from Equal Weight at Morgan Stanley.
• Siemens (NYSE: SI) was upgraded to Buy from Neutral at BofA/Merrill.

MOST NOTEWORTHY: AnnTaylor, FNB Corp and MFA Mortgage were today's noteworthy upgrades:

• Friedman Billings upgraded AnnTaylor (NYSE:ANN) to Outperform from Market Perform based on better management of the business by management, stabilizing fundamentals, and strong balance sheet and cash flow.
  
• B. Riley raised FNB Corp (NYSE:FNB) to Buy from Neutral as they feel more bullish about the company's prospects after meeting with management. The firm raised their target price to $16 from $15.50.
  
• Keefe Bruyette upgraded MFA Mortgage (NYSE:MFA) to Outperform from Market Perform following the company's 40M share equity offering, which they believe will add 2.5c a quarter to EPS.

OTHER UPGRADES:

• Dell (NASADAQ:DELL) was raised at Merrill to Buy from Neutral.
  
• Lehman upgraded Nasdaq (NASDAQ:NDAQ) to Overweight from Equal Weight.
  
• Big Lots (NYSE:BIG) was upgraded to Buy from Neutral at Piper.

MOST NOTEWORTHY: Ariad Pharma, FNB Corp. and Fortune Brands were today's noteworthy initiations:

• Jefferies finds Ariad Pharma (NASDAQ:ARIA) compelling as they believe the market potential for deforolimus in cancer is being underappreciated. Jeffieries initiated Ariad with a Buy rating and $8 target.
  
• B. Riley assumed coverage of FNB Corp. NYSE:FNB) with a Neutral rating and $15 target and sees limited viable lending opportunities in the current economic environment.
  
• Wachovia initiated Fortune Brands (NYSE:FO) with an Outperform rating and is positive on the company's position in Spirits. The firm believes its Home business is weighted towards the less cyclical remodels business.

OTHER INITIATIONS:

• William Blair initiated Smart Balance (NASDAQ:SMBL) with a Market Perform rating.
  
• Wachovia started PepsiCo (NYSE:PEP) and Anheuser-Busch (NYSE:BUD) with Market Perform ratings.