Analyst Upgrades

• Citigroup assumed coverage of Illinois Tool Works (ITW) and upgraded shares to buy from hold with a $52 price target. Citi cites valuation and the company's successful execution for the rating change.
• UBS upgraded Rowan Companies (RDC) to buy from neutral based on better-than-expected dayrates in the high specification jack-up market. The firm raised its price target to $42 from $28.
• UBS also upgraded NetLogic (NETL) to buy from neutral and keeps a $33.50 target on the stock. The firm upgraded shares based on valuation and solid long-term outlook.
• AvalonBay (AVB) and BRE Properties (BRE) were upgraded to neutral from underperform at Macquarie.
• Covance (CVD) was upgraded to equal weight from underweight at Morgan Stanley.
• Reynolds American (RAI) was upgraded to neutral from underperform at BofA/Merrill.

Analyst upgrades:

• Jefferies upgraded shares of Devon Energy (NYSE: DVN) to Buy from Hold on expectations that Haynesville results could be a catalyst in 2009. The firm raised their target to $100 from $94.
  
• Friedman Billings upgraded shares of Republic Services (NYSE: RSG) to Outperform from market Perform following the completed merger with Allied Waste (NYSE: AW).
  
• KeyBanc upgraded NorthWestern (NYSE: NWE) to Buy from HOld as they expect the Montana commission to grant the company's pending request for an accounting order to smooth pension expenses over five years.
• EnCana (NYSE: ECA) was upgraded to Neutral from Sell at Goldman.
  
• Goldman also upgraded Questar (NYSE: STR) to Buy from Neutral.
  
• Kinross Gold (NYSE: KGC) was raised to Outperform from Neutral at Credit Suisse.

Analyst downgrades:

MOST NOTEWORTHY: Pharmacopeia, Zumiez, Norfolk Southern and OccuLogix were today's noteworthy upgrades:

• CIBC upgraded Pharmacopeia (NASDAQ: PCOP) to Sector Outperformer from Sector Performer, as they believe its lead cardiovascular drug DARA has the potential to become an important new therapy for hypertension and diabetic nephropathy.
  
• Think Equity upgraded shares of Zumiez (NASDAQ: ZUMZ) to Buy from Accumulate to reflect the company's strong same store sales growth.
  
• Norfolk Southern Corporation (NYSE: NSC) was upgraded to Equal Weight from Underweight at Lehman Brothers on valuation.
  
• Caris upgraded shares of OccuLogix (NASDAQ: OCCX) to Above Average from Average, as they believe weakness in the stock creates a buying opportunity. The firm believes the stock has dropped due to concerns about the company's cash position, but thinks the current stock price underestimates the revenue potential of the company's assets.

OTHER UPGRADES:

• BRE Properties (NYSE: BRE) was upgraded to Outperform from Neutral at Credit Suisse.
  
• Bear Stearns raised Capital Product Partners (NASDAQ: CPLP) to Outperform from Peer Perform.
  
• JP Morgan upgraded Celestica (NYSE: CLS) to Neutral from Underweight.
  
• Stifel upgraded SL Green Realty (NYSE: SLG) to Buy from Hold.

MOST NOTEWORTHY: SanDisk Corp (SNDK), Nationwide Financial Services (NFS), Unica Corp (UNCA), International Paper Co (IP) and the Apartment REIT sector topped the day's noteworthy downgrades:

• CIBC cut SanDisk Corp (NASDAQ: SNDK) to Sector Performer from Outperformer on valuation.

• Nationwide Financial (NYSE: NFS) was downgraded to Underweight from Equal-Weight at Morgan Stanley on valuation.

• Ferris Baker cut Unica Corp (NASDAQ: UNCA) to Sell from Hold following the company's announcement that it has dismissed auditors Ernst & Young. Montgomery downgraded Unica to Hold from Buy on valuation.

• International Paper (NYSE: IP) was downgraded to Neutral from Outperform at Credit Suisse on valuation.

• UBS downgraded the Apartment REIT sector to Underweight and downgraded BRE Properties (NYSE: BRE), Camden Property Trust (NYSE: CPT) and Meruelo Maddux Properties (NASDAQ: MMPI) to Neutral from Buy...

OTHER DOWNGRADES:

• JP Morgan cut Moody's Corp (NYSE: MCO) to Neutral from Overweight.

• Lehman downgraded Powerwave Technologies (NASDAQ: PWAV) to Equal-Weight from Overweight.

• Goldman downgraded Target Corp (NYSE: TGT) to Neutral from Buy.

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