Wall to Wall Street Coverage: Upgrades and Downgrades

• By Justin Sharon
• On 8:50 am EDT, Monday October 19, 2009

Some say the Eighties officially ended last week, Wall Street instead waxing nostalgic for the millennial madness of 1999. But with insider trading (see also Should Insider Trading Be Legalized?) again hogging headlines and today marking 22 years since manic Monday, the Dynasty decade refuses to die.

Build-A-Bear (BBW) is in excellent shape on the anniversary of that big bear market after its 31.8% weekly gain. Oil's seven session streak has West Texas Crude heading north to a new '09 high. Gold, newly sold at the world's most famous department store, reached fresh nominal records but the dollar dropped to a 14-month trade weighted trough as America's $1.4 trillion budget deficit hit its highest since the Second World War.

The 1,018 page health care bill cleared a key Congressional hurdle and a movie based on a nine sentence book had a Wild ride atop the weekend box office. Weak business sent Business Week, founded two months before the '29 crash, into the bosom of Bloomberg. And two days after the escapades of Balloon Boy, a boy with a balloon exerted an outsize influence on a British soccer game. Eaton (ETN) and Apple (AAPL) announce earnings on a quiet day for economic data.

Initiations

Pfizer (PFE): The pharmaceutical company is initiated with an Overweight and $21 price target at Barclays Capital in light of cost savings with its acquisition of Wyeth.

Equipment Manufacturers: Caterpillar (CAT) ($65 target) and Deere (DE) are picked up with a Sector Perform ($49) at RBC Capital Markets.

Joy Global (JOYG): RBC Capital puts a smile on the face of Joy Global, assuming coverage with an Outperform and $60 price objective due to its resilient coal market revenue model.

Chico's FAS (CHS): The retailer is initiated with a Hold at Stifel Nicolaus, which sees some pospect of market share and margin rebuild.

Upgrades

Nestle: UBS upgrades Nestle to Buy from Neutral on a healthy emerging market exposure among other factors.

Halliburton (HAL): Natixis lifts Halliburton to Buy from Hold.

Sohu.com (SOHU): The stock is increased to Neutral from Sell at Pali Research on potential advertising improvement.

Dick's Sporting Goods (DKS): Piper Jaffray sees Dick's Sporting Goods as fiscally fit, raising its rating to Neutral from Underweight.

AirTran (AAI): The stock is increased to Overweight from Neutral at JP Morgan on improved liquidity and lower costs.

Estee Lauder (EL): RBC Capital takes Estee Lauder to Sector Perform from Underperform.

Viacom (VIA): RBC also increases Viacom (Outperform from Sector Perform). See also, Fighting a Battle, Redstone Lightens CBS and Viacom Load.

American Express (AXP): FBR Capital upgrades American Express to Market Perform from Underperform and increases its objective to $12 to $37 on improved credit performance.

Unilever (UL): UBS lifts Unilever (Neutral from Sell).

Downgrades

Southwest Airlines (LUV): The airline is lowered to Underweight from Neutral at JP Morgan, which says the shares should be trading closer to $11.

Freddie and Fannie: Keefe Bruyette cuts both Freddie Mac (FRE) and Fannie Mae (FNM) to Underperform, saying the stocks "should be worthless".

Abercrombie & Fitch (ANF): The retailer is reduced to Sell from Hold ($30 target) by Brean Murray, the broker believing aggressive discounting augurs ill given the current share price.

Mattel (MAT): Mattel is downgraded to Hold from Buy at Morgan Joseph on valuation. For more see What Mattel's Earnings Mean for Holiday Retail.

Callaway Golf (ELY): Morgan Joseph is also cutting Callaway Golf to Hold from Buy.

Accenture (ACN): UBS downgrades Accenture to Neutral from Buy.

Nothing contained in this article is intended as a solicitation for business of any kind or for investment in the firm.