Analyst Upgrades

• Alcatel-Lucent (ALU) to buy from neutral at Goldman.
• Nvidia (NVDA) to outperform from market perform at JMP Securities.
• Verizon (VZ), AT&T (T), Leap Wireless (LEAP) and MetroPCS (PCS) to outperform from neutral at RW Baird.
• Illumina (ILMN) to buy from hold at Auriga.
• Sun Bancorp (SNBC) to neutral from sell at Janney Capital.
• American Tower (AMT), SBA Communications (SBAC) and Freeport McMoRan (FCX) to overweight from equal weight at Morgan Stanley.

Verizon Communications (VZ), first discussed here on February 12, 2009, at a price of $29.86, continues to power higher, ascending to about $37 with a few hiccups, and I still like the shares here.

In 2011, slow growth and dividend play Verizon should post a 2% to 2.5% revenue gain, after flattish revenue in 2010, with data services being the key revenue increase driver. Meanwhile, Verizon's landline business continues to provide revenue stability.

AT&T (T) recently announced its proposed acquisition of T-Mobile in a cash and stock offer valued at roughly $39 billion. This is a significant announcement given the size of the two companies and since there was speculation that Sprint (S) might look to acquire T-Mobile. Sprint's shares were down 14% on this news. AT&T's move pits it firmly against Verizon (VZ) as both operators continue to build out their 4G networks.

Our price estimate for AT&T's stock stands at $35.80 which is around 40% ahead of the market price.

"We like stocks. And we like a lot of 'em. We focus on broadly diversified investments in undervalued stocks for their long-term appreciation potential," says value investor John Buckingham.

The money manager and editor of The Prudent Speculator explains, "Each month, we suggest a group of stocks that could help serve as a portfolio foundation. Here's a look at three such portfolio 'foundation' stocks: Kraft Foods (KFT), Verizon Communications (VZ) and Waste Management (WM).

Verizon (VZ) primarily competes with Sprint Nextel (S) and AT&T (T) in the mobile subscription plan business. The average monthly fee that Verizon's postpaid wireless subscribers pay for wireless service, excluding data service, has been consistently declining over the past few years. The decline in pricing is mainly attributable to nearing saturation of the U.S. cellular market, creating fierce competition among telecom players to maintain and increase their market share.

A successful Verizon-iPhone (AAPL) deal and rising data revenues from smart phone penetration could, however, offset declines in average mobile plan prices.

I first discussed Sprint Nextel (S) here on December 6, 2010, at a price of $4.17, and shares did push above $4.70 this winter before retreating on the market's recent pullback. I still like the shares at this stage, though.

However, keep in mind that Sprint is a high-risk stock, not suitable for low-risk or moderate-risk investors. Don't consider Sprint if you can't tolerate a more than 50% to 70% loss or seeing your entire investment wiped out -- it could happen.

Yesterday marked a pretty big day for Verizon Communications Inc. (VZ), as customers could finally walk into a Verizon store and pick up an iPhone. Some analysts had expected to see some long lines, but they did not materialize, creating the impression that the launch was less than successful, but looks can be deceiving.

It is easy to understand where the confusion comes from. In the past, whenever Apple released a new iPhone we saw long lines and often not even supply to cover the launch date demand, resulting in long waits for eager iPhone fanatics to get their hands on the new smartphone.

Verizon Communications (VZ), first discussed here on February 12, 2009, at a price of $29.86, has pushed through $30 resistance with room to spare, and one could make the argument that VZ is overvalued at this stage.

But that's not the argument favored here.

Look for slow growth/dividend play Verizon to post a 2% to 2.5% revenue gain in 2011, after flatish revenue in 2010, with data services being the key revenue increase driver. Meanwhile, Verizon's landline business continues to provide revenue stability.

Analyst upgrades:

• Verizon (VZ) to conviction buy from buy at Goldman.
• CSX (CSX) to outperform from market perform at Wells Fargo.
• AK Steel (AKS) to overweight from neutral, as well as Lorillard (LO) and Fifth Third Bancorp (FITB) to neutral from underweight, at JPMorgan.
• Marathon Oil (MRO) to overweight from equal weight at Morgan Stanley.
• Corning (GLW) to buy from outperform at CLSA.
• Quest Diagnostics (DGX) to buy from hold at Jefferies and to outperform from sector perform at RBC Capital.
• Salesforce.com (CRM) to buy from neutral at Roth Capital.
• Baker Hughes (BHI) to buy from hold at Weeden and to outperform from neutral at Macquarie.
• Western Digital (WDC) and Seagate (STX) to buy from underperform at BofA/Merrill.

Analyst Upgrades

• Dominion (D) to buy from hold at Deutsche Bank.
• Corinthian Colleges (COCO) to outperform from underperform at RBC Capital.
• Canadian National (CNI) to sector outperformer from sector performer at CIBC.
• DragonWave (DRWI) to buy from hold at Jefferies.
• Infosys (INFY) to overweight from equal weight at Morgan Stanley.
• SL Green Realty (SLG), Lexington Realty (LXP) and Taubman Centers (TCO) to overweight from neutral at JPMorgan.
• Sunstone Hotel (SHO) to buy from neutral and Extra Space Storage (EXR) to buy from hold at KeyBanc.

As everyone knows by now, the Apple (AAPL) iPhone is headed for Verizon's (VZ) reportedly more reliable network. With so much excitement over the announcement, traders and investors can look at various ways to profit off of this.

The obvious beneficiary is Apple, but there are additional ways to play it, such as the advertising companies, as Verizon hits the airwaves to promote the iPhone, even at the expense of the Android. A few ideas to consider include names like CBS (CBS) and Viacom (VIA), which should win no matter which platform wins.

Analyst Upgrades

• Verizon (VZ), FEMSA (FMX), Vornado (VNO), Duke Realty (DRE) and AvalonBay (AVB) to buy from neutral, as well as Carnival (CCL) to conviction buy from buy, at Goldman.
• Symantec (SYMC) to buy from hold at Citigroup.
• Copano Energy (CPNO), DCP Midstream (DPM) and Inergy (NRGY) to overweight from equal weight at Morgan Stanley.
• SYNNEX (SNX) to strong buy from buy at Needham.
• Eli Lilly (LLY) to hold from sell at Hapoalim.
• World Wrestling (WWE) to buy from neutral at Roth Capital.