Analyst Upgrades

• Google (GOOG) to outperform from neutral at Wedbush.
• Nike (NKE) to buy from neutral at UBS.
• Apollo Group (APOL) to market perform from underperform at FBR Capital.
• JDSU (JDSU) to overweight from neutral at Piper Jaffray.
• NetApp (NTAP) to overweight from equal weight and Verigy (VRGY) to equal weight from underweight at Barclays.
• RSC Holdings (RRR) to outperform from neutral at RW Baird.
• Exelon (EXC) to buy from hold at Jefferies.
• Aon (AON) and Willis Group (WSH) to outperform from market perform at Keefe Bruyette.
• BMC Software (BMC) to outperform from neutral at Cowen.

Analyst Upgrades

• Credit Suisse upgraded AT&T (T) to outperform from neutral and has a $35 target on the stock. Credit Suisse believes the impact from AT&T's loss of iPhone exclusivity will be less than expected and that the stock should benefit from its earnings growth and dividend yield.
• Goldman upgraded Freeport McMoRan (FCX) to buy from neutral and raised its price target to $94 from $79 based on improving copper fundamentals.
• Benchmark Co. upgraded Valueclick (VCLK) to vuy from hold on expectations Google Instant (GOOG) could drive marketing traffic. The firm raised its target price for Valueclick shares to $15 from $11.
• Best Buy (BBY) was upgraded to outperform from perform at Oppenheimer.
• Research In Motion (RIMM) was upgraded to buy from sell at Societe Generale.
• CarMax (KMX) was upgraded to outperform from market perform at Wells Fargo.

Analyst upgrades:

• Jefferies upgraded Consolidated Edison (NYSE: ED) to Buy from Hold on expectations the company will be able to reach a settlement with the New York PSC Staff that will provide benefits to both ratepayers and shareholders. The firm raised its target on shares to $46 from $40.50.
• Keefe Bruyette upgraded Public Storage (NYSE: PSA) to Market Perform from Underperform to reflect the company's balance sheet, industry leading position, and potential for accretive acquisitions. The firm raised its target on shares to $75 from $57.
• JPMorgan upgraded Big Lots (NYSE: BIG) to Overweight from Neutral to reflect valuation and industry data points that suggest a pick-up in discretionary spending. The firm has a $30 target on the stock.
• Alcoa (NYSE: AA) was upgraded to Buy from Hold at Deutsche Bank.
• East West Bancorp (NASDAQ: EWBC) was upgraded to Outperform from Market Perform at Keefe Bruyette.
• Bronco Drilling (NYSE: BDC) was upgraded to Neutral from Sell at UBS.

Analyst upgrades:

• Deutsche Bank upgraded Cemex (NYSE: CX) to Buy from Hold on decreased dilution risk following the company's successful refinancing and raised its target on shares to $15 from $11.20.
• Rochdale upgraded Wal-Mart (NYSE: WMT) to Buy from Neutral and raised its target to $65. The firm is positive on Wal-Mart's defensive characteristics, cyclical upside, and competitive position.
• JPMorgan upgraded Gartner Group (NYSE: IT) to Overweight from Neutral to reflect stabilization in IT industry spending and the stock's attractive valuation. The firm has a $23 price target on the stock.
• Cavium Networks (NASDAQ: CAVM) was upgraded to Overweight from Equal Weight at Barclays.
• Borg-Warner (NYSE: BWA) was upgraded to Buy from Neutral at BofA/Merrill.
• Nanometrics (NASDAQ: NANO) was upgraded to Outperform from Perform at Oppenheimer.

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Bidz.com Inc. (NASDAQ: BIDZ) Q4 earnings release included notice about an SEC investigation.
• Dell Inc. (NASDAQ: DELL) saw net income drop by almost 50%, falling short of estimates.
• Ducommun Inc. (NYSE: DCO) received an analyst's downgrade after its Q4 earnings release.
• Gap Inc. (NYSE: GPS) said Q4 earnings fell due to weakness at Gap and Old Navy stores.
• General Motors Corp. (NYSE: GM) worse-than-expected results prompted speculation about its survival.

Public Storage (NYSE: PSA - option chain) shares are headed higher today after the company reported a fourth-quarter profit of $151.7 million after the close yesterday. PSA's funds from operations of $1.49 per share beat analysts' projections of $1.28 per share.

This industry has been one of my favorites for a while as it addresses Americans' dual compulsions to buy stuff and never get rid of it. Plus, their business model is pretty nice -- they charge a whole lot of cash just store your junk in a garage that cost them very little to build and maintain. 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 PSA.

There are a number of ways to play the recession / depression on the market that might seem, at first, counter-intuitive but on second glance make sense. Here's one -- Public Storage (NYSE: PSA), a REIT focused on ownership of public storage facilities.

Like the rest of the real estate market, it's been hammered -- down just over 52% from 52-week highs of $110 per share. But public / self storage facilities should actually prosper in this market. Here's why: People still have a lot of stuff, but many of them are going to have less house very soon. Same goes for businesses that are putting off plans to expand offices or rent warehouses and need a place to park things.

Analyst upgrades:

• Baird upgraded Regal-Beloit (NYSE: RBC) to Outperform from Neutral based on valuation and growth expectations.
• Black & Decker (NYSE: BDK) and Lennar (NYSE: LEN) were upgraded to Buy from Neutral at UBS based on valuation.
• Kroger (NYSE: KR) and Public Storage (NYSE: PSA) were added to Goldman's Conviction Buy List.
• CIBC upgraded Biovail (NYSE: BVF) to Sector Performer from Sector Underperformer.
• Abercrombie & Fitch (NYSE: ANF) was raised to Neutral from Underperform at Cowen.

Analyst downgrades:

• Merrill downgraded Campbell Soup (NYSE: CPB) to Neutral from Buy and expects marketing and promotional spending to limit earnings growth in 2009 and 2010. The firm lowered their target to $35 from $42.
• Mechel Steel (NYSE: MTL) was cut to Underweight from Equal Weight at Morgan Stanley to reflect declining coal demand.
  
• Friedman Billings downgraded shares of Legg Mason (NYSE: LM) to Underperform from Market Perform on liquidity concerns given the Legg Mason's leveraged balance sheet and falling EBITDA. The firm lowered their target to $7 from $11.

This post is part of our Ads Gone Bad series. Share your thoughts and memories of this ad in the comments, and be sure to check out our other posts on marketing gone wrong.

I have watched this controversial advertisement for the Public Storage Co. over and over and I take no offense. Spike has portrayed it as the most anti-Semitic "worst ever" commercial, but I do not see it that way. Given my father is a survivor of the Holocaust (Warsaw Ghetto and all) and I have grown up with many accounts of murderous atrocities and learned of, and experienced, many more anti-Semitic accounts, I think Spike is way off base with this one.

Despite large and growing declines in both the commercial and residential real estate markets, one part of the real estate sector is having a good year. Self-storage companies, which are often structured as REITs, are posting some good numbers. Face it, American's have way too much stuff and not enough space to store it at home. Americans move, go away to college, get divorced, join the military and/or lose their homes in foreclosure with alarming regularity. All of these life events require short-term storage. According to a survey in Investment News, self-storage REITs have generated total returns of 20% or more YTD. This compares very favorably with the 5% or more drop in the S&P 500 stock index YTD.

A snapshot of the sector shows four of the largest self-storage companies on the upswing. Sovran Storage Incorporated (NYSE: SSS) at $40.88 is up 1.95% YTD. Most other self-storage REITs have more impressive returns. Extra Space Storage (NYSE: EXR) at $15.11, up 6.90% YTD. Public Storage Incorporated (NYSE: PSA) at $83.55 is one of the most expensive self-storage stocks. It is up 7.59% YTD. The bargain in the self-storage sector is U Store It Trust (NYSE: YSI). At $11.54 the stock is up a whopping 28.82% YTD. Investors should call around to self-storage companies in their areas. Chances are they will not find many vacant units.

Despite a lower "trade deficit" number, investors have been taking profits. Seeing oil go over $126.00 hurt more than a horrible turnout in financials. Below are the unofficial closing levels:

• DJIA 12,745.88 -120.90 -0.94%
• S&P500 1,388.28 -9.40 -0.67%
• NASDAQ 2,445.52 -5.72 -0.23%
• 10YR-TBond 3.7670% -0.0380
• 52-WEEK LOW CLUB
• TOP 10 ANALYST CALLS

American International Group, Inc. (NYSE: AIG) fell over 8% to $40.26 after reporting huge losses and disclosing that would raise $12.5 Billion in capital.

MOST NOTEWORTHY: Pfizer, Dell, Quest Diagnostics, and Societe Generale were today's noteworthy upgrades:

• Lehman upgraded Pfizer (NYSE: PFE) to Equal Weight from Underweight on valuation.
  
• Friedman Billings raised Dell (NASDAQ: DELL) to Outperform from Market Perform, citing expectations for improved margins next quarter, and valuation.
  
• Quest Diagnostics (NYSE: DGX) was upgraded to Outperform from Neutral by Credit Suisse, which cited valuation.
  
• Lehman upgraded shares of Societe Generale (OTC: SCGLY) to Overweight from Underweight to reflect a potential takeover by BNP Paribas and limited downside.

OTHER UPGRADES:

• Bayer (OTC: BAYRY) was raised to Overweight from Equal Weight by Lehman.
• Deutsche Telekom (NYSE: DT) was upgraded to Hold from Sell by Citigroup.
• Public Storage (NYSE: PSA) was raised to Buy from Hold by Deutsche Bank.
• UBS raised Entergy (NYSE: ETR) to Buy from Neutral.

MOST NOTEWORTHY: Sierra Pacific (SRP), Intersil (ISIL), Fannie Mae (FNM) and Freddie Mac (FRE) were today's noteworthy downgrades:

• Deutsche Bank downgraded shares of Sierra Pacific (NYSE: SRP) to Hold from Buy on valuation and uncertainty over the company's Integrated Resource Plan investment program.
  
• Jefferies downgraded shares of Intersil (NASDAQ: ISIL) to Hold from Buy and lowered their target to $30 from $38 after their Asia channel checks indicated the first wave of cancellations for PWM ICs from the leading Taiwan Motherboard manufacturers.
  
• Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) were lowered to Neutral from Buy at UBS, citing credit pressures that will likely require increased reserves.

OTHER DOWNGRADES:

• First Marblehead (NYSE: FMD) was downgraded to Underperform from Market Perform at Friedman Billings.
  
• The firm also downgraded Casey's General Stores (NASDAQ: CASY) to Market Perform from Outperform.
  
• Public Storage (NYSE: PSA) was lowered to Market Perform from Outperform at Wachovia.

Most mergers are driven by the notion, sometimes wildly mistaken, that the combination will bring both a competitive advantage. Some pairs of companies, however, seem so intuitively right for one another, no bottom-line considerations should be allowed to interfere with their matrimony. Like a slot machine and a blue hair with a pocket full of quarters, these two were meant for one another.

George Carlin has a famous rap (NSFW) about Americans and our love of stuff, which drives our need to build more places to put our stuff. That's always struck me as an integrated business plan. Two seemingly perfect partners for such a business are Dollar General (NYSE: DG) and Public Storage (NYSE: PSA).

Dollar General is a leader in recreational shopping for the denominationally challenged. If you have a hankering for neon-colored plastic, something covered in polyester fur, food with the half-life of uranium-235 or clothing with the style of Piltdown Man, DG is your go-to source.There you'll find shelf after shelf of non-essentials, the kind that end up in storage sheds. Currently, the 8,260-store company is in the process of merging with Buck Holdings LP.

If this deal falters, though, how about a merger with Public Storage? PSA (I'm a little uneasy with a company whose stock ticker is the name of a prostate cancer screening test, by the way) is a REIT with direct and indirect interest in over 2,000 self-storage developments in the U.S., containing, I'm sure, a great deal of material from Dollar General. The merger would be an excellent opportunity to double-down on America's seemingly inexhaustible need for more stuff.

MOST NOTEWORTHY: REITs, Business Objects, Allstate Corp and P&C Insurance were today's noteworthy downgrades:

• Deutsche Bank downgraded REITs AvalonBay (NYSE: AVB), Boston Properties (NYSE: BXP), Health Care REIT (NYSE: HCN), Kimco (NYSE: KIM) and Public Storage (NYSE: PSA) to Hold from Buy on valuation following the recent share appreciation.
  
• Business Objects (NASDAQ: BOBJ) was downgraded to Neutral from Outperform at Baird following its acquisition by SAP AG (NYSE: SAP).
  
• Wachovia downgraded Allstate Corporation (NYSE: ALL) to Market Perform from Outperform and P&C Insurance (NYSE: PGR) citing deteriorating fundamentals in personal lines.

OTHER DOWNGRADES:

• UBS downgraded BEA Systems (NASDAQ: BEAS) to Neutral from Buy.
  
• JP Morgan downgraded Merrill Lynch (NYSE: MER) to Neutral from Outperform.
  
• Sealy Corporation (NYSE: ZZ) was downgraded to Neutral from Buy at Banc of America.
  
• Friedman Billings downgraded technology stocks, lowering ASE Test Limited (NASDAQ: ASTSF), ASML Holding (NASDAQ: ASML), KLA-Tencor (NASDAQ: KLAC) and Rudolph Technologies (NASDAQ: RTEC) to Market Perform from Outperform.