Maybe this week's theme should be industry consolidation. At least that's where the rumors, and signs, seem to be pointing.

CLEVELAND-CLIFFS INC (NYSE: CLF)

Think iron pellets. If you do, you won't be alone. Lots of options folk think they've caught a takeover candidate, and have been picking up bullish options all over. Is it steel industry consolidation fever? Most probably. Rio Tinto plc ADS (NYSE: RTP) and Brazil's CVRD have been named as predators. Speculation about the company's future actually began late last summer for a company with a market cap of just $3B, which happens to be the largest producer of iron ore pellets in all of North America, and a key part of producing steel. The stock has been heading up for about seven months now. Makes sense.

NORFOLK SOUTHERN CORPORATION (NYSE: NSC)

Higher and higher goes the stock for a few reasons: Railroad stocks look to be buyout candidates, and some analysts are focused on the Southern, the fourth largest railroad in the U.S. The other reason? Mr. Warren Buffett also owns 6.4M shares worth over $300M. Good enough?

EQUITY INNS INC (NYSE: ENN)

There's speculation that the Inns are in buyout mode. The stock recently hit a 52-week high, and has been going up for about six weeks. Some who follow the company think it's definitely worth more than the $20 a share range.

And two that won't go away: Monster Worldwide Inc (NASDAQ: MNST) and Sherman-Williams Company (NYSE: SHW) are absolutely considered to be prime takeover targets.

MOST NOTEWORTHY: JetBlue Airways Corp (JBLU), Nationwide Financial (NFS) and Deere & Co (DE) were today's notable upgrades:

• Goldman Sachs upgraded JetBlue Airways Corp (NASDAQ: JBLU) to Buy from Neutral with a $16 target and added shares to their America's Buy List, as they believe management initiatives should bring improved margins.
  
• Nationwide Financial Services Inc (NYSE: NFS) was upgraded to Peer Perform from Underperform at Bear Stearns.

• Deere (DE) was upgraded to Neutral from Sell at Longbow.

OTHER UPGRADES:

• United Parcel Service Inc (NYSE: UPS) was added to Citigroup's Recommended List based on valuation.

• Morgan Stanley upgraded Baidu.com Inc ADS (NASDAQ: BIDU) to Equal Weight from Underweight.

• Bear Stearns upgraded Office Depot Inc (NYSE: ODP) to Outperform from Peer Perform with a $43 target based on valuation and the potential upside to lowered guidance.

• AG Edwards upgraded American Eagle Outfitters inc (NASDAQ: AEOS) to Buy from Hold with a $41 target on valuation.

• Oppenheimer upgraded Qualcomm Inc (NASDAQ: QCOM) to Buy from Neutral with a $50 target citing the impact of MediaFlo mobile TV services, GSM Association 3G initiatives, and WDCMA deployment in the U.S. at AT&T/Cingular (NYSE: T).

• BB&T upgraded Equity Inns Inc (NYSE: ENN) to Buy from Hold following the company's fourth-quarter results.

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