Analyst Upgrades

• Alcatel-Lucent (ALU) to buy from neutral at Goldman.
• Nvidia (NVDA) to outperform from market perform at JMP Securities.
• Verizon (VZ), AT&T (T), Leap Wireless (LEAP) and MetroPCS (PCS) to outperform from neutral at RW Baird.
• Illumina (ILMN) to buy from hold at Auriga.
• Sun Bancorp (SNBC) to neutral from sell at Janney Capital.
• American Tower (AMT), SBA Communications (SBAC) and Freeport McMoRan (FCX) to overweight from equal weight at Morgan Stanley.

Analyst Upgrades

• Diamond Offshore (DO) to conviction buy from sell and Baker Hughes (BHI) to buy from neutral at Goldman.
• Frontier Communications (FTR) to outperform from market perform at Wells Fargo.
• Syntel (SYNT) to outperform from market perform at Wells Fargo, to buy from hold at Deutsche Bank and to buy from neutral at Janney Capital.
• Kulicke & Soffa (KLIC) and Fiserv (FISV) to outperform from perform at Oppenheimer.
• 3M (MMM) to neutral from underweight and Tyco (TYC) to overweight from neutral at JPMorgan.
• Collective Brands (PSS) and Nordstrom (JWN) to overweight from equal weight, as well as Foot Locker (FL) to equal weight from underweight, at Morgan Stanley.
• Amazon.com (AMZN) to buy from hold at Lazard Capital.
• Yamana Gold (AUY) to outperform from neutral at Credit Suisse.

Analyst Upgrades

• Intel (INTC) was upgraded to buy from neutral at UBS.
• Wells Fargo upgraded MetroPCS (PCS), Coventry Health (CVH) and Scientific Games (SGMS) to outperform from market perform.
• Estee Lauder (EL) was upgraded to overweight from equal weight at Barclays.
• Simon Property (SPG) was upgraded to buy from hold at Jefferies.
• Citigroup upgraded BreitBurn Energy (BBEP) to buy from hold.

Analyst Upgrades

• State Street (STT) was upgraded to buy from neutral at Goldman.
• Roth Capital upgraded Intel (INTC), Marvell Technology (MRVL) and Nvidia (NVDA) to buy from neutral.
• Bebe Stores (BEBE) was upgraded to buy from neutral at Janney Montgomery.
• W&T Offshore (WTI) was upgraded to buy from accumulate at Global Hunter.
• Citigroup upgraded International Rectifier (IRF) and Timberland (TBL) to hold from sell.
• Watson Pharma (WPI) was upgraded to buy from neutral at UBS.
• Atmel (ATML) was upgraded to strong buy from buy at Needham.
• Ashford Hospitality (AHT) was upgraded to outperform from neutral at RW Baird.
• Oppenheimer upgraded MetroPCS (PCS) to outperform from perform.

One rule of stock investing is you "never chose a play just for fun." Even so, some stocks remain more-interesting than others, and MetroPCS Communications (PCS), which I first discussed here on December 21, 2009, at a price of $7.55, is one such stock.

MetroPCS remains "the little engine that might." Note: I consider MetroPCS to be a high-risk stock not suitable for low to moderate risk investors.

MetroPCS provides cell phone service to customers without requiring long-term contracts. Unlike the per-minute cell phone service providers, MetroPCS offers unlimited, flat-rate plans for local and long-distance service. Operating in more than 10 states, it has about 6.6 million customers.

Barnes & Noble, Inc. (BKS) rallied today 20% after announcing that its board intends to evaluate strategic alternatives, including a possible sale of the company, in order to increase stockholder value. Overall option implied volatility of 56 is above its 26-week average of 48, according to Track Data, suggesting larger price movement.

Volatility Monitor: SPDR Trust Unit +0.1% to 20.3, CBOE Russell 1000 Index -1% to 27.3, S&P 100 Index -0.5% to 18.8 according to IVolatility.

Call strikes with large percentage moves; MetroPCS Communications, Inc. (PCS) August 45 call volatility decreased 5%. priceline.com Incorporated (PCLN) August 280 call volatility decreased 23% according to IVolatility's RT Options Scanner.

Update is by Stock Specialist Paul Foster of theflyonthewall.com

The shares of MetroPCS Communications (PCS), first discussed here on December 21, 2009 at a price of $7.55, 'the little engine that might,' have reversed course.

Note: I consider MetroPCS to be a high-risk stock not suitable for low/moderate-risk investors.

Fundamentally, the major question for PCS concerns whether it can grow its subscriber base without price cuts given strong competition. The calculation here is that while margins may continue to be pressured in the quarters ahead, we've bottomed in terms of the U.S. employment situation -- a bullish trend for PCS's subscriber roles -- and this will more than offset any additional price cuts.

Prepaid wireless play MetroPCS Communications (PCS), first discussed here on December 21, 2009 at a price of $7.55, 'the little engine that might,' has gone in the wrong direction -- down -- in the past three months.

Note: I consider MetroPCS to be a high-risk stock not suitable for low/moderate-risk investors.

Even worse, technically, the chart has formed a bear hug -- a bearish trend in which the stock rallies to the key, 50-day moving average, only to decline again. Typically, the stance would be to close the position. However, a recent pop above the 50-day MA provides some hope, so the stance is to maintain the play.

Today was a very unusual day. There was no real economic data to absorb. And the markets did see some unusual options trading ahead of expiration date at 4:00 PM today. Disappointing earnings kept a negative bias in the air despite a brief recovery into positive territory in the final hour today... Yet the negative close seemed almost a certain fate today.

Here are today's unofficial closing bell levels:

Dow 10,318.16 -14.28 (-0.14%)
S&P 500 1,091.37 -3.53 (-0.32%)
Nasdaq 2,146.04 -10.78 (-0.50%)

Top Analyst Calls
Top Day Trader Alerts
Unusual Options Trading

Another record deficit, a Geithner likely tax boost, and higher import prices failed to significantly spook the markets even after a five or day run-up. Based on the late day recovery, where this close was going to end up was an unknown until right at the closing bell. The day was a very light day for news, so here are the closing bell levels (unofficial close):

Dow 9,603.98 -23.50 (-0.24%)
S&P 500 1,042.73 -1.41 (-0.14%)
Nasdaq 2,080.90 -3.12 (-0.15%)

Top Analyst Upgrades
Top Analyst Downgrades
Top Day Trader Alerts

The ARS market has thrust its poisoned tentacles in another direction. After raising interest costs for issuers and wiping out the formerly "safe" cash holdings of individual investors, the Wall Street Journal reports that frozen ARS accounts have hit tech companies as well.

Specifically, the Journal lists $855.7 million worth of ARS holding on the books of these five tech companies, listed as follows:

• Monster Worldwide, Inc. (NASDAQ: MNST): $357 mm
• Intuit, Inc. (NASDAQ: INTU): $328 mm
• Palm, Inc. (NASDAQ: PALM): $74.7 mm
• Earthlink, Inc. (NASDAQ: ELNK): $60 mm
• MetroPCS Communications, Inc. (NASDAQ: PCS): $36 mm

These companies and others will probably need to write down the value of these securities unless the ARS market unfreezes. If there is an industry that's unscathed by this problem, I'd like to know. But for those who've invested in companies whose cash is frozen in these ARS accounts, there are many restless nights ahead.

MAJOR PAPERS:

• Once thought to be extremely safe, action rate securities have proved difficult to sell in this credit crisis. Tech companies are big holders of them and are taking charges left and right, including MetroPCS Communications Inc (NYSE: PCS), Palm Inc (NASDAQ: PALM) and Earthlink Inc (NASDAQ: ELNK), according to the Wall Street Journal.
• Electronic Arts Inc (NASDAQ: ERTS) is again urging Take-Two Interactive Software Inc (NASDAQ: TTWO) to negotiate after it recommended that its stockholders not sell any of its shares to EA and help its $2B takeover bid, the Financial Times reported.

OTHER PAPERS:

• NYSE Euronext Inc (NYSE: NYX) will look to increase its stakes in India's National Stock Exchange and the country's Multi Commodity Exchange, the Business Standard reported, once foreign ownership rules are eased. NYSE Euronext also intends to partner with the two Indian exchanges in order to help them develop their business.

WEB SITES:

• Business Week reported that Brian Marckx of Zacks Investment Research said Bristol Myers Squibb Company (NYSE: BMY) may be an attractive takeover candidate for a larger pharma such as Pfizer Inc (NYSE: PFE) or France's Sanofi-Aventis SA (NYSE: SNY), both of which have been partners with Bristol on some of its products.

MAJOR PAPERS:

• The Wall Street Journal reported that in a list released last night by the FCC, Google Inc (NASDAQ: GOOG), Cablevision Systems Corporation (NYSE: CVC) and other "nontraditional" players are set to compete against more traditional wireless companies like Qualcomm Incorporated (NASDAQ: QCOM) and MetroPCS Communications Inc (NYSE: PCS) in the federal government's spectrum auction next month.

OTHER PAPERS:

• Banks that include Merrill Lynch & Co Inc (NYSE: MER) and The Bear Stearns Companies Inc (NYSE: BSC) are reportedly in talks to help bail out struggling bond insurer ACA Capital Holdings, which lost $1B in the most recent quarter, according to two people briefed on the situation and reported by the New York Times; ACA Capital has guaranteed $26B in mortgage securities.
• Executives at Tribune Company (NYSE: TRB) were faced with last-minute questioning from bankers that were reluctant to fund the final portion of the $8.2B deal to take the company private, according to sources close to the company, the Chicago Tribune reported.

WEB SITES:

• Barron's Online's "Inside Scoop" reported that analysts are not convinced that the deal with Citadel is enough to save E*Trade Financial Corporation (NASDAQ: ETFC), as it does not eliminate E*Trade's $12.4B second-lien mortgage exposure, and the company could potentially face further customer attrition, which many think will continue to pressure the shares.

Last week, MetroPCS Communications (NYSE: PCS) ended its $4 billion merger deal for Leap Wireless (NASDAQ: LEAP), which thought the deal wasn't good enough. Both companies provide wireless services to those that the major carriers -- like Verizon (NYSE: VZ) and AT&T (NYSE: T) -- tend to avoid (such as low-income customers).

Well, LEAP shareholders may be regretting things. On the company's latest news bomb, the stock has plunged 34% to $38.33. In fact, since late July, the stock is down a stunning 61%.

First of all, LEAP said it will have to restate financial results for 2004, 2005, 2006 and the first half of 2007. The items include service revenues, operating expenses and so on. The amount is about $20 million or so.

Not so big, huh? Maybe not. After all, the company could be in default on its $890 million of debt.

Oh, and the company garnered only 36,500 subscribers in Q3 (the goal was 40,000). And, it looks like Q4 growth will be meager too.

All in all, it's hard to find anything good here. Then again, Leap's space is full of buyout activity so I wouldn't be surprised if we eventually hear some more buyout buzz on the company, especially in light of the big cut in the valuation.

PCS shares are tumbling over 20% as well today.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

MOST NOTEWORTHY: Teva Pharma, Novavax, Corinthian Colleges, Fair Isaac and Tenneco were today's noteworthy upgrades:

• Friedman Billings upgraded Teva Pharmaceutical (NASDAQ: TEVA) to Outperform from Market Perform following Teva's better-than-expected Q3 report and guidance.
  
• Oppenheimer upgraded shares of Novavax (NASDAQ: NVAX) to Buy from Neutral based on positive expectations for Ph I/IIa pandemic influenza data, the start of clinical trials for seasonal influenza, and expected announcement of a vaccine product candidate in Q4.
  
• Corinthian Colleges (NASDAQ: COCO) was upgraded to Buy from Neutral at Merrill following its better-than-expected Q1 report and guidance.
  
• Citigroup upgraded of Fair Isaac (NYSE: FIC) to Buy from Hold shares to reflect the company's strong Q4 results and improved outlook.
  
• Tenneco (NYSE: TEN) was raised to Outperform from Market Perform at Wachovia based on valuation and revenue opportunities in commercial truck market.

OTHER UPGRADES:

• Energizer Holdings (NYSE: ENR) was upgraded at Bear Stearns to Peer Perform from Underperform.
  
• Key Banc upgraded Post Properties (NYSE: PPS) to Hold from Underweight.
  
• Morgan Stanley upgraded MetroPCS (NYSE: PCS) to Overweight from Equal Weight.
  
• William Blair upgraded LECG Corporation (NASDAQ: XPRT) to Market Perform from Underperform.