On a day when many telecom stocks were hit with downgrades, China Mobile Limited (NYSE: CHL) distinguished itself this morning by scoring an upgrade. Goldman Sachs raised its rating on CHL from "sell" to "neutral," while simultaneously trimming the stock's price target from HK$95 to HK$90. The price-target cut echoes a similar move made by Citigroup on Sunday; the brokerage firm cut its target on CHL from HK$120 to HK$100.

In response to today's mixed analyst comment, CHL is down more than 7% at midday. The equity has shed about 42% year-to-date, and its lengthy decline could prompt additional price-target cuts during the short term. According to Thomson Financial, China Mobile shares are trading about 60% south of their average 12-month price target of USD $81.01.

Today's upgrade from Goldman comes as CHL is approaching former support at the $44 level. This region buoyed the stock in early 2007 and earlier this month, which suggests that it could once again provide a floor for the shares. Unfortunately, though, the stock is also looking up at stiff technical resistance from its 10-week moving average, which means China Mobile might find itself bouncing sideways in the weeks to come. Or -- even more troubling -- a continued drop in the share price could spark an unwinding of widespread optimistic sentiment.

While Apple Inc. (NASDAQ: AAPL) has had relatively smooth going in Europe introducing the iPhone, things are apparently less so in China (and Russia) where it is being reported: China Mobile to Buy Out iPhone in China.

The negotiations between China Mobile Ltd (NYSE: CHL) have led to many compromises on the part of Apple. To get the deal done it agreed to have no more sharing from toll revenues of cooperative carriers, and the Wi-Fi function of the multimedia smartphone is to be deleted.

Although it has been widely reported the Chinese anxiously want to sell iPhones to their hundreds of millions of potential customers -- something Apple has been vigorously pursuing -- it took several rounds of negotiations after which Apple got the short end of the stick.

Just one more company bending to the will of the Chinese. I wonder how long it will be before they reverse engineer the phone using Apple as another pawn in the game of technology transfer? I wonder if there is anything that should or can be done about it?

I'm sure after all is said and done Apple got the best deal it could. I just hope it works out as well as it envisioned.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I do not own shares of AAPL.

MOST NOTEWORTHY: Banco Santander, Solera, FTI Consulting and Blue Coat Systems were today's noteworthy initiations:

• Societe Generale expects the Banco Santander's (NYSE: STD) strong organic growth in earnings to continue with the purchase of ABN Amro's (NYSE: ABN) assets in Brazil and Italy, starting shares off with a Buy rating. Shares were started at Merrill Lynch with a Neutral rating.
  
• William Blair initiated Solera Holdings (NYSE: SLH) with an Outperform rating, as they believe underlying trends for auto insurance claims are favorable.
  
• FTI Consulting (NYSE: FCN) was initiated at Deutsche Bank, as they believe the company is positioned to sustain double-digit growth, and with a Buy rating and $65 target and at Goldman with a Neutral rating and $62 target.
  
• Pacific Crest initiated Blue Coat Systems (NASDAQ: BCSI) with a Sector Perform rating on valuation and estimates fair value at $50/share.

OTHER INITIATIONS:

• BNP Paribas started shares of China Netcom (NYSE: CN) and China Telecom (NYSE: CHA) with Buy ratings and China Mobile Limited (NYSE: CHL) with a Hold rating.
  
• Cosan Limited (NYSE: CZZ) was initiated with a Neutral rating at Goldman.
  
• Methanex Corporation (NASDAQ: MEOH) was started at HSBC with an Overweight rating.

China Mobile Ltd. (NYSE: CHL) recently announced FY 2006 annual results. Lots of good news for investors. China's economy continues to grow rapidly albeit unevenly. Total China Mobile subscribers now exceed 300 million, up 22% from FY 2005. Nearly half of the growth in its subscriber base came from accounts initiated in rural areas. China Mobile is now the largest mobile communications provider in mainland China. It is on track to increase its subscriber base by almost 5 million new accounts per month for FY 2007. China Mobile subscribers used a total of 1,252.15 billion minutes of talk time in FY 2006.

Operating revenue rose 22% from FY 2005. Net profit increased 23%. Basic earnings per share rose 22.5%. China Mobile has also branched out into value-added components of telecommunications in China. This sector increased 38% from FY 2005, and accounted for 23.5% of China Mobile's total operating revenue for FY 2006.

Looking into the future, China Mobile spent $284 million for a 89% stake in Paktel Ltd., Pakistan's state telecom operator. China Mobile is actively preparing for the introduction of third-generation -- 3G -- wireless technology in China to permit the transmission of video and other services. The Chinese government has yet to grant permission for these new services, but they need to be in place well prior to the 2008 Olympics in Beijing. China Mobile has also established a corporate social responsibility committee and issued its first Corporate Responsibility Report.