Analyst Upgrades

• U.S. Steel (X) to buy from neutral and Barnes & Noble (BKS) to neutral from sell at Goldman.
• Salesforce.com (CRM) to buy from hold at Jefferies.
• Dollar Tree (DLTR) to overweight from equal weight at Barclays.
• Edison International (EIX) to hold from sell at Citigroup.
• Analog Devices (ADI) to overweight from neutral at JPMorgan.

Analyst Upgrades

• Interpublic Group (IPG) to buy from hold at Deutsche Bank.
• Radware (RDWR) to outperform from perform at Oppenheimer.
• Fluor (FLR) and Waddell & Reed (WDR) to buy from hold, as well as AllianceBernstein (AB) to hold from sell, at Citigroup.
• MetroCorp (MCBI) and American Capital (AGNC) to outperform from market perform at Keefe Bruyette.
• International Flavors (IFF) to overweight from equal weight at Barclays.
• BioCryst (BCRX) and Southern Company (SO) to buy from neutral at BofA/Merrill.
• Bunge (BG) to overweight from neutral at HSBC.

Restaurant chain Chipotle Mexican Grill (CMG), has vectored from $90 to $200.65 in 2010, on both new restaurant openings, and a likely low/mid-single-digit increase in same-store sales.

The key phrase in the above being a possible 'mid-single-digit' SSS increase: a decent traffic and sales increase is not consistent with the U.S.'s current 'frugal consumer' trend, but Chipotle appears to be bucking the trend.

Chipotle operates restaurants in the fast casual dining segment, using fresh ingredients and traditional cooking methods to cook tacos, burritos, salads, and burrito bowls. As of the start of 2010, CMG had 956 restaurants in 35 states, with more than half in California, Ohio, Texas, Colorado and Illinois.

When I discussed Chipotle Mexican Grill (CMG) back in January, I was a bit hesitant on buying the stock. If you look at the following chart, you'll notice that I was completely wrong to be even the slightest bit bearish. The company closed on Friday at $168.31, not far from the 52-week high of $170.

According to our analyst calls from last Friday, Jefferies & Co. initiated the stock with a hold rating. The question now is, should an investor agree with such a rating? A hold may not be a technical sell, but it definitely makes you think twice about buying.

Quarterly reports continue to roll out this week, with results due from Allstate Corp. (ALL), Coca-Cola Co. (KO), Marriott International Inc. (MAR), Molson Coors Brewing Co. (TAP), New York Times Co. (NYT), Pepsico Inc. (PEP), Sprint Nextel Corp. (S), Viacom (VIA), Walt Disney Co. (DIS) and many others. Here's a look at a few of the companies that analysts surveyed by Thomson Reuters expect to be the biggest earnings gainers this week.

Analysts are looking for Coinstar Inc. (CSTR), which distributes coin-counting, DVD-rental, and other self-service kiosks, to report that its fourth-quarter earnings more than doubled from a year ago to $0.32 per share. Revenue for the three months that ended in December is expected to have jumped 26.1% to $329.2 million. The analysts' forecast for the full year calls for earnings of $0.94 per share (+46.8%) on $1.2 billion in revenue (+25.9%). Coinstar has beat earnings estimates in the past three quarters, by as much as six cents per share.

Chipotle Mexican Grill (CMG), whose colleagues include Burger King (BKC) and Yum! Brands (YUM), saw a nice rally on Friday. It closed up over 6%. Volume was very active. The stock is several dollars short of the 52-week high.

According to Benzinga.com, Morgan Stanley upgraded the restaurant chain to overweight status. Furthermore, an attractive prediction on price has been proffered by the firm: $111. Considering that the stock had a value of $91.89 per share at the end of Friday's session, I'd say buying now and riding the company to $111 would represent a decent trade.

MOST NOTEWORTHY: Ascent Solar, Xcorporeal and Chipotle Mexican Grill were today's noteworthy initiations.

• Cowen said Ascent Solar Technologies Inc.'s (NASDAQ: ASTI) unique thin-film solar technology is well suited for integrated applications. Shares were started with an Outperform rating.
• Roth Capital believes Xcorporeal Inc (AMEX: XCR) is targeting a large, unmet market, as the firm notes that 500K patients are expected to receive kidney therapy over the next few years. Roth, which initiated shares without a rating, anticipates that the company will obtain regulatory approval for the home therapy and critical care markets during the next few quarters, possibly creating a catalyst for the stock to appreciate.
• JP Morgan initiated the Class B shares of Chipotle Mexican Grill Inc (NYSE: CMG.B) with an Overweight rating as they believe the recent pullback provides a compelling entry point.

OTHER INITIATIONS:

• Lehman initiated NCR Corporation (NYSE: NCR) with an Overweight rating and $30 target.
• Sandler initiated Delphi Financial Group Inc (NYSE: DFG) with a Buy rating and $34 target.

Chipotle (NYSE:CMG) is recently up $1.90 to $116.90. CMG is scheduled to report Q1 EPS on April 23. Morgan Joseph says "Q108 should mark the first quarter of growth deceleration for CMG. While we believe CMG remains one of the best operators in the industry, we also believe that like its comps, it will eventually fall victim to the recessionary consumer environment." CMG May call option implied volatility is at 55, puts are at 65; above its 26-week average of 48, according to Track Data, suggesting larger price risk. CMG puts are priced higher than calls because CMG is difficult to borrow.

Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

MOST NOTEWORTHY: Chipotle Mexican Grill, Micrus Endovascular and Acorda Therapeutics were today's noteworthy initiations:

• Jefferies expects the quality gap between Chipotle Mexican Grill (NYSE: CMG) and its peers will become more apparent in a weakening consumer environment. The firm started shares with a Buy rating and $110 target.
  
• Micrus Endovascular (NASDAQ: MEND) was initiated with an Outperform rating and $20 target at Barrington, citing the company's strong product line, improving salesforce, leading market share position and their expectation for continued strong transition from clipping to coiling.
  
• Acorda Therapeutics (NASDAQ: ACOR) was assumed with an Overweight rating at JP Morgan, as they believe the company's Fampridine-SR for multiple sclerosis is a $500M + opportunity

OTHER INITIATIONS:

• Stanford initiated Mariner Energy (NYSE: ME) with a Buy rating and $35 target.
  
• Deutsche Bank assumed Liberty Entertainment (NASDAQ: LMDIA) with a Buy rating and $29 target.
  
• EnerNoc (NASDAQ: ENOC) was initiated with a Neutral rating at Broadpoint.

For those who are new to BloggingStocks, I wrote a series back in May-June of 2007 highlighting what I thought could be the top 25 stocks for the NEXT 25 years. The series was written and researched as an answer to a USA Today article that highlighted the best 25 stocks of the past 25 years.

I wrote about Chipotle Mexican Grill (NYSE: CMG) back on May 21. The stock was trading at $82 per share, although I had been recommending it in my advisory service back when the shares were trading at $40. I thought, and still do, that Chipotle has a chance to be the next major American fast food restaurant chain. In September 2007, the shares hit $114-115, and frankly, I thought the stock was ahead of itself and needed to take a breather. I wrote an update piece explaining that although I still believed Chipotle will be a major player for the NEXT 25 years, it seemed prudent to take the opportunity for short term profits. Commodity costs were rising and the chain was not about to raise its menu prices to offset.

The shares proceeded to go as high as $155 and I thought that maybe I misread this one. The numbers were strong and I thought the momentum in the name might actually keep it afloat. Phew, finally, this one has come back to earth. Chipolte has fessed up that higher commodity costs and a slower spending consumer have taken their toll. The shares are back down to $105, representing a 30 P/E multiple on 2009 earnings per share expectations of $3.40. Still expensive, but this is a very high growth rate company.

I would wait for the shares to trade back below $90 before putting a toe in the water. The concept is viable and very popular. The chain has room to quadruple its store base in the United States and will emerge as the best new concept in this decade and the next. I'd keep an eye on the share value and start accumulating on major dips.

Georges Yared write about great growth stocks today in Game On Investing

MOST NOTEWORTHY: BioScrip, Chipotle Mexican Grill and CoStar Group were today's noteworthy upgrades:

• BioScrip (NASDAQ: BIOS) was raised to Buy from Neutral at Broadpoint, as they believe the company's specialty business is worth more than the current price implies.
  
• Baird upgraded Chipotle Mexican Grill (NYSE: CMG) to Outperform from Neutral following Q4 results, citing valuation and a positive view on fundamentals.
  
• CoStar Group (NASDAQ: CSGP) was upgraded to Outperform from Market Perform at JMP Securities, as they expect the company to report a solid quarter next Thursday.

OTHER UPGRADES:

• Groupe Danone (OTC: GDNNY) was upgraded to Buy from Hold at ING.
  
• UBS raised Senior Housing Properties (NYSE: SNH) and Fluor Corp (NYSE: FLR) to Buy from Neutral.
  
• Morgan Stanley upgraded RenaissanceRE Holdings (NYSE: RNR) to Overweight from Equal Weight.

Chipotle Mexican Grill (NYSE: CMG) experienced some delicious growth over its fourth quarter and full-year reporting period. As the press release issued on Valentine's Day after the market closed indicated, Q4 revenues spiced up almost 32% to $288.9 million, and diluted earnings soared 61% to $0.53 per stub. For the full year, revenues jumped 32% to $1.1 billion, and diluted earnings rocketed 66% to $2.13 per share.

But was this enough to satisfy the after-hours market? Nope -- at the time of this writing, the after-hours quote on Chipotle's stock was down almost 13%. I'll give you a second or two to guess why. Got it yet? Sure you do -- even if you hadn't already read the headlines, you must have intuited that Chipotle didn't meet analyst expectations. The sacrosanct Wall Street crowd wanted a couple pennies more for the quarter.

Well, I say the Chipotle story looks pretty good from where I'm sitting. Restaurant operating margins are up, comps are up over 10% for the quarter and the year, and new stores will continue to be rolled out. Plus, operational cash flow increased 42%. Chipotle, which used to be a part of McDonald's (NYSE: MCD), is becoming a major brand in the restaurant sector, and is a strong competitor against related companies such as Burger King (NYSE: BKC), Wendy's (NYSE: WEN), and Yum! Brands (NYSE: YUM).

Yes, economic times will be difficult going forward, as Ben Bernanke has warned, but I've got a sneaking suspicion Chipotle Mexican Grill's stock will recover from the recent pullback from its 52-week high of better than $155.

MOST NOTEWORTHY: BigBand Networks, Chipotle Mexican Grill, Vertex Pharmaceuticals and Cognos were today's noteworthy downgrades:

• BigBand Networks Inc. (NASDAQ: BBND) was downgraded to Hold from Buy at Jefferies and to Market Perform from Outperform at Morgan Keegan on the company's negative Q2 pre-announcement to reflect decreased visibility.
  
• Citigroup downgraded Chipotle Mexican Grill Inc. (NYSE: CMG) to Hold from Buy on valuation.
  
• Vertex Pharmaceuticals Inc. (NASDAQ: VRTX) was downgraded to Neutral from Buy at Merrill Lynch, as they believe investor expectations are high into November's American Association for the Study of Liver Diseases meeting.
  
• Soleil downgraded Cognos Inc. (NASDAQ: COGN) to Hold from Buy as they believe the strong Canadian dollar will depress operating margins and limit share upside.

OTHER DOWNGRADES:

• Jefferies downgraded Spectra Energy Corp. (NYSE: SE) to Hold from Buy.
  
• Goldman downgraded MeadWestvaco Corp. (NYSE: MWV) to Neutral from Buy and removed Crown Holdings Inc. (NYSE: CCK) from its Americas Conviction Buy List.
  
• UBS downgraded Atlantic Tele-Network Inc. (NASDAQ: ATNI) to Neutral from Buy.

In my series on the top 25 stocks for the NEXT 25 years, I recommended Chipotle (NYSE: CMG) as one of the picks. The stock was at $82 per share on May 21 when I wrote about the company. The $82 price represented a market capitalization of $2.6 billion. Today the stock is at $114.65 with a market cap of $3.7 billion, up over 40% for investors who bought the stock.

But, I have to admit that short-term I am nervous about Chipotle. I still believe the concept is becoming the new rave in the fast food service sector. I still believe that Chipotle could take on McDonald's-like proportions in the years to come -- but I am nervous about the short-term prospects. Why?

I have two reasons. First, higher commodity prices: The price of wheat and dairy has gone up in the United States, which, I believe, could affect Chipotle's pricing structure and general margins. In this consumer-wary environment, restaurants are not about to raise menu prices and risk losing customers. Therefore, I think the food cost expenses for Chipotle's (and many other fast food chains) are going up and will stay high for a while. The second reason I am nervous is Chipotle is a domestic company with no international sales. It is purely reliant on American diners for its revenues.

Fast food Mexican restaurant Chipotle Mexican Grill Inc (NYSE: CMG), a spin-off of McDonald's Corporation (NYSE: MCD), is down a little over 2% today after a negative Barron's Online article.

The Barron's "Weekday Trader" article stated that after hitting an all-time high yesterday, the stock is due to fall. It cites two downgrades of Chipotle from earlier this summer, the rise in the prices of ingredients, and the fact that Americans are eating out less.

With as much market uncertainty as we are seeing, and the fear the uncertainty is causing among investors, stocks trading at such high multiples -- such as Chipotle's 54x 2007 P/E ratio, are due to fall. The only question now is -- how far?

Editor's Note: Special shout out to BloggingStocks' own Georges Yared, who is quoted in the Barron's article.