Hospira (HSP - option chain) shares are rising today after the company announced that the FDA has approved its generic cancer treatment docetaxel. The brand-name drug it will compete against, Sanofi-Aventis' (SNY) Taxotere, had sales of $1.2 billion in 2010. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on HSP.

HSP opened this morning at $53.66. So far today the stock has hit a low of $53.55 and a high of $56.00. As of 12:05, HSP is trading at $54.65 up $1.02 (1.9%). The chart for HSP looks bullish and S&P gives HSP a positive 4 STARS (out of 5) buy ranking.

Analyst Upgrades

• KeyBanc upgraded Las Vegas Sands (LVS) to hold from underweight based on Singapore performance and a potential revaluation of the yuan.
• ThinkEquity upgraded Seattle Genetics (SGEN) to buy from hold based on the positive SGN-35 HL data. The firm raised its price target to $16 from $12.
• Merriman upgraded Applied Signal (APSG) to buy from neutral with a $28 to $31 valuation range, citing greater confidence in earnings estimates and the company's recent contract wins.
• Siliconware Precision (SPIL) was upgraded to neutral from underperform at Macquarie.
• Pulte Group (PHM) was upgraded to neutral from sell at Goldman.
• Greenbrier (GBX) was upgraded to outperform from market perform at Morgan Keegan.

Analyst upgrades:

• Bernstein upgraded Hospira (HSP) to Outperform from market Perform based on valuation, expectations that the company will be able to fix manufacturing issues quickly, and views Propolfol and biosimilars as underappreciated. The firm has a $63 price target on the stock.
• Citigroup upgraded eBay (EBAY) to Buy from Hold citing valuation and improvements to Marketplace. The firm keeps a $28 price target for shares.
• Deutsche Bank upgraded Coca-Cola Femsa (KOF) to Hold from Sell citing lessening acquisition risk and raised its target for shares to $66 from $61.
• Blackstone (BX) and Simon Property (SPG) were upgraded to Conviction Buy from Buy at Goldman.
• BreitBurn Energy (BBEP) was upgraded to Outperform from Market Perform at Wells Fargo.
• SL Green Realty (SLG) was upgraded to Buy from Neutral at BofA/Merrill.

Analyst upgrades:

• Citigroup assumed coverage of Boeing (BA) and upgraded the stock to Buy from Hold due to its positive view on the aerospace cycle and valuation. The firm raised its target for shares to $80 from $73.
• Morgan Stanley upgraded Motorola (MOT) to Overweight from Underweight citing expectations for higher handset margins driven by Android. The analyst raised Android unit shipping estimates and earnings estimates. The firm raised its price target on shares to $9.75 from $8.75.
• Susquehanna upgraded SINA Corporation (SINA) to Positive from Neutral and has a $50 target on the stock. The firm said Sina'a Twitter like service called 'Sina Weibo' has seen exponential growth and will crate huge value for the company.
• AOL (AOL) was upgraded to Neutral from Underperform at Credit Suisse.
• Frontier Communications (FTR) was upgraded to Sector Perform from Underperform at RBC Capital and to Buy from Hold at Hudson Square.
• Canadian Solar (CSIQ) was upgraded to Outperform from Market Perform at Wells Fargo.

Analyst Upgrades

• Auriga upgraded Allscripts (MDRX) to buy from hold to reflect valuation and potential synergies from the company's pending merger with Eclipsys (ECLP). The firm upped its target price for shares to $20 from $19.
• SunTrust upgraded Newell Rubbermaid (NWL) to buy from neutral based on completion of its turnaround plan, stabilizing end markets and favorable comparisons. The firm has a $25 price target on the stock.
• Morgan Joseph upgraded C.R. Bard (BCR) to buy from hold based on valuation and upside to estimates from the share buyback program. The firm has a $97 price target on the stock.
• Shire (SHPGY) was upgraded to buy from hold at Lazard Capital.
• Onyx Pharma (ONXX) was upgraded to outperform from market perform at BMO Capital.
• AvalonBay (AVB) was upgraded to neutral from sell at UBS.

Hospira (HSP - option chain) stock is trading lower today after the company announced this morning it has agreed to buy Javelin Pharmaceuticals (JAV) for $2.20 per share in cash, or $145 million. HSP expects to begin a tender offer for all shares of JAV on April 21. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on HSP.

This morning, HSP opened at $56.15. So far today the stock has hit a high of $56.85 and a low of $54.19. As of 11:50, HSP is trading at $55.30, down $1.80 (-3.1%). The chart for HSP looks neutral and S&P gives HSP a neutral 3 STARS (out of 5) hold ranking.

Sanofi-Aventis (SNY - option chain) stock is trading lower today after the company announced this morning that it has settled patent infringement suits with Hospira (HSP) and Par Pharmaceutical Companies (PRX) related to certain generic versions of its cancer treatment Eloxatin. The settlements will stop HSP and PRX from selling generic versions of Eloxatin from late-June until August 2012. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on SNY.

This morning, SNY opened at $36.51. So far today the stock has hit a high of $36.69 and a low of $36.43. As of 12:10, SNY is trading at $36.69, down $0.51 (-1.4%). The chart for SNY looks neutral and S&P gives SNY a neutral 3 STARS (out of 5) hold ranking.

Analyst Upgrades

• Credit Suisse views Bank of America (BAC) as the "cheapest" large-cap bank and said the recent TARP repayment removes a significant overhang. The firm upgraded shares to outperform from neutral and raised its target to $21 from $17.
• Piper Jaffray upgraded Bed Bath & Beyond (BBBY) to neutral from underweight following the company's better-than-expected Q3 results. The firm has a $43 price target on the stock.
• Caris upgraded Zumiez (ZUMZ) to above average from average following the company's better-than-expected December sales report. The firm raised its target on shares to $17 from $14.
• Humana (HUM) was upgraded to equal weight from underweight at Barclays.
• Zimmer (ZMH) was upgraded to buy from neutral at BofA/Merrill.
• Applied Industrial (AIT) was upgraded to buy from hold at KeyBanc.

Analyst upgrades:

• Baird upgraded Tenet Healthcare (NYSE: THC) to Outperform from Neutral and raised its target to $6 from $5 based on cost trends, valuation, and expectations the company can beat expectations over the next six months.
• Oppenheimer upgraded E-House (NYSE: EJ) to Outperform from Perform following the company's better-than-expected Q2 results. The firm has a price target of $27 on shares.
• JPMorgan upgraded Avery Dennison (NYSE: AVY) to Overweight from Neutral and has a $33 target on the stock. The firm cites valuation for the upgrade following the recent underperformance and expects the company's margins to expand as demand rebounds.
• Citigroup (NYSE: C) was upgraded to Buy from Underperform at BofA/Merrill.
• Taubman Centers (NYSE: TCO) was upgraded to Conviction Buy from Buy at Goldman.
• First Niagara (NASDAQ: FNFG) was upgraded to Buy from Neutral at Janney Montgomery.

Analyst upgrades:

• JMP Securities upgraded CB Richard Ellis (NYSE: CBG) to Outperform from Market Perform. The analyst believes the new Public-Private Investment Program will create liquidity, which will result in some degree of activity. Shares were also upgraded at JP Morgan to Overweight from Neutral.
  
• Thomas Weisel upgraded Linear Tech (NASDAQ: LLTC) to Overweight from Market Weight due to stabilizing business and favorable end market exposure.
  
• UBS upgraded PepsiCo (NYSE: PEP) to Buy from Neutral and raised its target to $60 from $57 due to moderating input costs, earnings and investment flexibility, improving U.S. beverage business, and leverage from its market share in food.
• Tibco (NASDAQ: TIBX) was raised to Buy from Neutral at Goldman.
  
• Philips Electronics (NYSE: PHG) was upgraded at ING Group to Buy from Hold.
  
• Hospira (NYSE: HSP) was upgraded to Outperform from Market Perform at Leerink.

MOST NOTEWORTHY: Mako Surgical, ArcSight and ICU Medical were today's noteworthy initiations:

• Mako Surgical (NASDAQ: MAKO) was initiated with an Overweight rating at JP Morgan. The firm believes Mako has the most compelling system for navigated, robotic assisted orthopedic surgery to date.
  
• After ArcSight (NASDAQ: ARST) reported better-than-expected results for its Q3 and guidance for Q4 that Wachovia views as positive, the firm, which initiated shares with an Outperform rating, expects that regulatory compliance initiatives such as SOX will help protect the company from the slowdown, and help result in upward revisions to Wachovia's estimates in the future, as well as margin expansion.
  
• Soleil believes ICU Medical's (NASDAQ: ICUI) close distributor relationship with Hospira (NYSE: HSP) will drive its CLAVE/Custom IV franchises. The firm started shares with a Buy rating and $33 target.

OTHER INITIATIONS:

• Bear initiated Journal Comm (NYSE: JRN) with an Outperform rating and $10.25 target.
  
• Royal KPN (NYSE: KPN) was initiated at Societe Generale with a Sell rating.
  
• Broadpoint assumed Nuance Comm (NASDAQ: NUAN) with a Buy rating and $22 target.

The accidental transmission of infections is a big day-to-day problem for hospital personnel. There is an outfit in San Clemente, California that makes devices designed to avoid one of the major sources of the problem.

ICU Medical (NASDAQ: ICUI) provides disposable medical connection systems for use in intravenous (IV) therapy applications. Its products prevent accidental IV disconnects, protect patients from catheter related bloodstream infections and guard healthcare workers from exposure to infectious diseases through accidental needle sticks. The firm also manufactures various critical care products, including pressure monitoring devices, blood sampling systems, cardiac monitoring systems and angiography kits, under an agreement with Hospira (NYSE: HSP). Baxter International (NYSE: BAX) is a major competitor.

The company pleased investors last week, when it reported Q1 EPS of 63 cents. Analysts had been expecting 44 cents. Revenues rose 0.2 percent (yr/yr) to $48.8 million. Management also guided FY07 EPS to $1.97 ($1.79 consensus) and FY07 revenues to $206.0 million ($205.9M consensus). Gross margins rose to 39%, from 33% in Q4. ICUI shares popped above 200-day moving average support on the news and are now forming a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

The proper administration of medication is among the most critical of all medical procedures. There is a firm in Lake Forest, Illinois that helps care-givers maintain the best possible standards of safety and precision in the administration of over 130 injectable drugs, in over 600 dosages and formulations.

Hospira Inc. (NYSE:HSP) is a specialty pharmaceutical and medication delivery company. Its portfolio includes a broad line of generic acute-care and oncology injectables, anesthetics and diagnostic imaging agents. The firm also makes pre-filled syringes and intravenous delivery systems for quick and accurate administration by health-care providers. In acquiring Australia-based rival Mayne Pharma last month, Hospira doubled its international sales to nearly 30% of total sales.

Hospira surprised investors last week when it announced Q4 EPS of 43 cents and revenues of $706.5 million. Analysts had been expecting 38 cents and $673.7 million. Management also guided FY07 EPS to $2.11-$2.16 ($2.08 consensus) and FY07 revenues to $3.4-$3.48 billion ($3.44B consensus). Banc of America subsequently reiterated its "buy" rating on the issue and boosted its price target to $44. HSP shares popped through 200-day moving average resistance on the news and have since been consolidating the gain in a bullish "pennant" pattern. Equities frequently exit pennants moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Altogether, brokers now recommend the shares with three "strong buys," two "buys" and one "hold." Analysts see a 17% growth rate through the next year. The HSP P/E ratio (26.40), Price to Sales ratio (2.27), Price to Book ratio (4.48), Price to Cash Flow ratio (15.45), Price to Free Cash Flow ratio (35.69), EPS Growth rate (34.38%), Return on Assets (8.43%), Return on Investment (10.72%) and Return on Equity (17.68%) compare favorably with industry and sector averages.

Institutions hold about 72% of the outstanding shares. The stock is one of those used to calculate the S&P 500 Index. Over the past twelve months, it has traded between $31.15 and $45.25. A stop-loss of $33.85 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.