Lehman Brothers reiterated its "underweight" rating on Circuit City (NYSE:CC) ahead of the company's annual meeting, according to the AP.

Credit Suisse started Hovnanian (NYSE:HOV) and Meritage Homes (NYSE:MTH) as "underperform," according to Briefing.com.

Thomas Weisel downgraded Yahoo! (NASDAQ:YHOO) to "underweight" from "market weight," according to Briefing.com. The news service also reports that UBS upped its price target on Potash (NYSE:POT) from $250 to $285.

MOST NOTEWORTHY: Lukoil, ENI SpA and Meritage were today's noteworthy upgrades:

• Citigroup upgraded shares of Lukoil (OTC: LUKOY) to Buy from Hold on valuation, as they believe the company's oil production, refineries and gas stations outside of Russia are not priced into shares.
  
• ABN Amro raised ENI SpA (NYSE: E) to Hold from Sell after a meeting with management.
  
• Meritage (NYSE: MTH) was upgraded to Buy from Neutral at UBS on strong results.

OTHER UPGRADES:

• Morgan Stanley upgraded Corporate Executive (NASDAQ: EXBD) to Equal Weight from Underweight.
  
• Trico Marine Services (NASDAQ: TRMA) was upgraded to Overweight from Equal Weight at Lehman.
  
• Holly Corp. (NYSE: HOC) was raised to Outperform from Market Perform at BMO Capital.

Moody's is giving the rating of several home builders another haircut. The current downgrades include Hovnanian (NYSE: HOV), M/I Homes (NYSE: MHO), and Meritage Homes (NYSE: MTH).

Aside from what the ratings change will do to the shares of the companies, this raises, once again, the question of whether a large home builder could go into Chapter 11. Increasingly, the answer to that question looks like it may be "yes."

According to CNN Money, "Homebuilders keep lowering prices to meet flagging demand, crimping profit margins at a time when overall sales continue to deteriorate." At some point soon, many of these companies will need to raise money. It is not clear that they will be able to in the current credit market.

Shares in Meritage certainly trade as if investors believe that the company may have to restructure and that investors may get the short end of the stick. At the current share price of $8.41, the stock is down from a 52-week high of over $47.

Investors may be better off getting out of these stocks with losses. Otherwise they may ride the train to "zero."

Douglas A. McIntyre is an editor at 247wallst.com.

MOST NOTEWORTHY: Genesit Energy LP (GEL), EnerNoc (ENOC) and Comcast (CMCSA) were today's noteworthy initiations:

• Genesis Energy (AMEX: GEL) was initiated with a Buy rating and $40 target at Stanford, as the firm believes the company's affiliation with Denbury Resources and pending acquisition of petroleum products, terminals, and transportation businesses from the Davison family will drive rapid growth.

• EnerNoc Inc (NASDAQ: ENOC) was initiated with a Hold rating and $42 target at Jefferies, due to valuation. EnerNoc was also initiated at Morgan Stanley with an Equal Weight rating and $40 target.

• Stifel expects Comcast (OTC: CMCSA) to benefit from higher penetration levels of DVR and HDTV set-top boxes over the next several years and initiated shares with a Buy rating and $34 target.

OTHER INITIATIONS:

• Select asset managers were initiated at Credit Suisse:

• AllianceBernstein (NYSE: AB), Affiliated Managers (NYSE: AMG), Fortress Investment (NYSE: FIG), Invesco (NYSE: IVZ), Franklin Resources (NYSE: BEN) and T Rowe Price (NASDAQ: TROW) were initiated with Outperform ratings.

• Blackrock (NYSE: BLK), Calamos Asset Mgmt (NADAQ: CLMS), Eaton Vance Corp (NYSE: EV), Federated Investors (NYSE: FII), Janus Capital (NYSE: JNS), Legg Mason Inc (NYSE: LM) and Waddell & Reed (NYSE: WDR) were initiated with Neutral ratings.

• Deutsche Bank initiated Ryland Group (NYSE: RYL) with a Buy rating and $52 target, as well as Pulte Homes (NYSE: PHM) and Meritage Homes Corp (NYSE: MTH) with Hold ratings and a $23 target and $29 target, respectively.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).