Analyst Upgrades

• Procter & Gamble (PG) upgraded to buy from neutral at Goldman.
• Capital One (COF) upgraded to outperform from market perform at FBR Capital.
• Airgas (ARG) upgraded to outperform from neutral at RW Baird.
• Broadcom (BRCM) upgraded to positive from neutral at Susquehanna.
• Lululemon (LULU) upgraded to hold from underperform at Jefferies.
• DryShips (DRYS) upgraded to outperform from neutral at Credit Suisse.

Analyst Upgrades

• Red Hat (RHT) and American Public (APEI) to outperform from sector perform at RBC Capital.
• KBR (KBR) and Foster Wheeler (FWLT) to buy from neutral at Goldman.
• Bio-Rad (BIO) to outperform from market perform at Leerink.
• Oceaneering (OII) to outperform from neutral at Credit Suisse.
• ASM International (ASMI) and Avid Technology (AVID) to overweight from neutral at JPMorgan.
• Dominion Resources (D) to equal weight from underweight at Morgan Stanley.
• Nationwide Health Properties (NHP) to buy from hold at Jefferies.
• Vivus (VVUS) to buy from underperform at BofA/Merrill.
• Intersil (ISIL) to buy from hold at Canaccord.

Analyst Upgrades

• JPMorgan upgraded Vivus (VVUS) to overweight from neutral.
• Citigroup upgraded Corn Products (CPO) to buy from hold.
• Maxim Integrated (MXIM) was upgraded to outperform from market perform at FBR Capital.
• Cardinal Health (CAH) was upgraded to outperform from neutral at RW Baird.
• Citigroup upgraded Monster Worldwide (MWW) and EchoStar (SATS) to buy from hold, as well as Las Vegas Sands (LVS) to buy from sell.
• BMO Capital upgraded Potash (POT) and Barrick Gold (ABX) to outperform from market perform.

Of course, oil prices could moderate this year to the $40-per-barrel range, and the U.S. government could invest in a serious way in natural gas for vehicle propulsion.

But until then, the reign of oil continues, and it makes sense to consider Oceaneering International (OII), which I first wrote about on April 7, 2009 at a price of $38.01. If you bought Oceaneering in April 2009, you're up more than 100%, and there's more upside ahead. That said, it's perfectly acceptable to take some profits here with OII: those investors who can tolerate the risk, can retain the shares to go for an even bigger gain.

The price of oil could moderate in the year ahead, if U.S. and global GDP growth comes in below forecasts. Otherwise, there's a better than 50/50 chance oil arcs toward $100 -- again -- and that's a big reason I'm reiterating my buy rating for Oceaneering International (OII), first recommended on April 7, 2009 at a price of $38.01. If you bought OII in April 2009, you're up about 50%.

To be sure, renewable energy source use is on the rise, but breakthrough energy form discovery aside, oil will continue to be the world's most important commodity for at least 15-20 years, and probably for longer than that. And that bodes well for drillers and oil service companies like OII.

This post is part of a special report, Top Picks for 2010, the 27th annual survey in which TheStockAdvisors.com asks the nation's leading advisors for their single favorite stock for the new year. See all 80 stocks listed here.

"Oil recently suffered a pullback, but we think it's temporary," says Brandon Clay, who turns to the oil sector for his top pick for 2010.

The editor of Invest with an Edge suggests, "One stock that should pull out of congestion when energy moves again in 2010 is Oceaneering International (OII), a company involved in deep-water drilling services.

One of the top performers in the U.S. growth fund sector has lost his appetite for tech. Jerry Jordan has booted almost all his Apple (AAPL) holdings from his portfolio, and he's done the same with Google (GOOG). Both, Jordan says, have become too expensive. In fact, he's getting out of almost all U.S. and European tech companies for that reason -- and is turning his attention to China.

Jordan tells Reuters, "The growth [in China] is much faster, it's much more of a green field opportunity."

Renewable energy sources are on the rise, but a breakthrough energy form discovery aside, oil will continue to be the world's most important commodity for at least 20 years, and probably for longer than that.

And that bodes well for drillers and oil service companies, which is why I'm Reiterating my Buy rating for Oceaneering International (NYSE: OII), first recommended on April 7, 2009 at a price of $38.01. If you bought Oceaneering then, you're up more than 40%.

It goes without saying that I favor the oil sector, including drillers and oil servicers. Breakthrough energy form discovery aside, oil will continue to be the world's most important commodity for at least 15-20 years, and probably for longer than that.

Hence, I'm Reiterating my Buy rating for Oceaneering International (NYSE: OII), first recommended on April 7, 2009 at a price of $38.01.

"Midyear is as good a time as any to pause and reflect," says Richard Moroney in Dow Theory Forecasts -- a newsletter with the distinction of having been published for more than 50 years.

Here, he reviews the state of the market and offers a look at trio of favorite stocks which he considers "fundamentally superior" companies: Biogen Idec (NASDAQ: BIIB), Comcast (NASDAQ: CMCSA), and Oceaneering International (NYSE: OII).

Few sectors contained more promise during the recent global GDP expansion than drillers and oil servicers. However, few sectors became more oversold than the aforementioned, as well, during the oil bust in 2008.

Further, while one should not expect oil to return to the $140-range anytime soon, the notion that oil will remain in the $40-50 range for a long time is equally slim. And that makes the case for Oceaneering International (NYSE: OII).

"We see smooth seas ahead for deepsea driller Oceaneering International (NYSE: OII)," says Richard Moroney.

The editor of the blue chip advisory, Dow Theory Forecasts, explains, "Most of the world's untapped oil reserves lie under the ocean floor, and oil producers are spending an increasing portion of their capital budgets on deepwater drilling."

"While oil prices don't directly affect Oceaneering International's profits and cash flows, they do move the stock. Oil prices fell by two-thirds in the second half of 2008, pushing Oceaneering shares under $20 for the first time since July 2005.

"Many experts believe that oil prices are at unsustainably low prices now, and they expect a sharp rise in the commodity price as supply and demand come back into line again," says turnaround expert George Putnam.

In The Turnaround Letter, he suggests, "If oil does begin to rise again, the oilfield service stocks could rebound sharply." Here, he takes a look at large cap plays on a rebound within the oilfield services sector.

"We all know that oil prices have fallen dramatically from their highs in the summer of 2008. But different types of oil-related stocks have reacted quite differently to the price change in the underlying commodity.

"For example, while oil itself has dropped nearly 70% from its 12-month high, the stock of the largest integrated oil company, Exxon-Mobil (NYSE: XOM), is down only 26%, less than the stock market as a whole.

Analyst upgrades:

• Merrill upgraded shares of General Motors (NYSE: GM) and Ford (NYSE: F) to Neutral from Underperform on expectations for fundamentals to improve in 2009.
  
• Citigroup upgraded Chubb (NYSE: CB) and Travelers Group (NYSE: TRV) to Buy from Hold as they expect the company to benefit from the AIG (NYSE: AIG) fallout. The firm raised Chubb's target to $57 from $56 and Travelers Group's target to $51.50 from $49.50.
  
• Credit Suisse upgraded shares of SAP AG (NYSE: SAP) to Outperform from Neutral as they believe margin expansion can drive higher profitability.
• JetBlue (NASDAQ: JBLU) was upgraded to Buy from Hold at Argus.
• Goldman raised Merrill Lynch (NYSE: MER) to Neutral from Sell.
  
• NetLogic (NASDAQ: NETL) was upgraded to Buy from Neutral at Piper.

Analyst downgrades:

• JP Morgan downgraded Eli Lilly (NYSE: LLY) to Underweight from Neutral citing the company's early stage pipeline and generic competition.
  
• Merrill downgraded Unilever (NYSE: UL) to Neutral from Buy as they believe the incoming CEO is unlikely to bring a major restructuring or split up the company.

"Our 'Forecasts Focus List' contains only two energy stocks, both of which are in the oil services sector: Oceaneering International (NYSE: OII) and Transocean (NYSE: RIG)," says blue chip advisor Richard Moroney.

The editor of Dow Theory Forecasts says, "While stocks in the equipment and services group tend to move with oil prices in the near term, their profits depend more on exploration spending than on commodity prices."

"Concerns about slowing demand for crude oil and re?ned products both in the U.S. and overseas have many investors worried. But investors in the equipment and services group should not panic.

"Most producers continue to spend aggressively. And U.S. crude-oil inventories remain well below the average for this time of year, with fewer than 20 days of supply in storage.

"Demand for offshore-drilling services remains strong, giving Transocean excellent growth potential. Consensus estimates project per-share profits will rise 69% in 2008 and 15% in 2009. Transocean, the world's largest offshore drilling contractor, operates in every major drilling region.

"A combination of tight global rig supplies and the ongoing discovery of new offshore reserves have driven rig lease rates higher and kept Transocean's fleet busy. The company's largest, most expensive rigs are 95% sold out for 2009, and the backlog is growing.