MORNING COFFEE

Eurozone Plan Now Has Doubts. After rally, economist and the analysts are beginning to have doubts about the eurozone's €750B ($966B) rescue fund. Some economists are critical of the Eurozone's decision to solve a debt crisis by issuing more debt.  Rick Paler president of RL Paler Investment Advisors, LLC said “It’s like putting a band-aid on bullet wound, without the EU governments changing their cradle to grave entitlement societies; we will be revisiting this problem again.”  He also said “I fear that the U.S. is heading down the same path and we need to learn from Europe’s mistakes. 

Telefonica Offers to Buy Brasilcel. Telefonica (TEF) has made an €5.7B ($7.3B) cash offer for the 50% stake that Portugal Telecom owns in Brasilcel NV. Brasilcel is owned 50-50 by Telefonica and Portugal Telecom, and controls 60% of Brazilian mobile company Vivo Participacoes (VIV). Telefonica also announced it would buy another 3.8% of Vivo shares for €600M. 

Upgrades

Smith & Wesson (SWHC): Wedbush raised their rating from Neutral to Outperform and placed a target price of $6.00 on the company.

Electronic Arts (ERTS): MKM Partners raised their rating from Sell to Neutral.

Buffalo Wild Wings (BWLD): MKM Partners raised their rating from Neutral to Buy.

Cheesecake Factory (CAKE): Robert W. Baird raised their rating from Neutral to Outperform and placed a target price of $32.00 on the company.

Downgrades

Baxter (BAX): Argus lowered their rating from Buy to Hold.

Coverage Reiterated/Price Target Changed

Apple (AAPL): Kaufman Bros reiterated their Buy rating and changed their target price from $315.00 to $320.00.

Earning Reports

Fluor (FLR): Reported Q1 EPS of $0.76 beating estimates by +$0.02 on revenue of $4.9 billion. 

Legg Mason (LM): Reported Q4 EPS of $0.39 beating estimates by +0.04 on revenue of $671 million.

MBIA (MBI): Reported Q1 EPS of -$7.22 missing estimates by -$1.02.

McDermott International (MDR): Reported Q1 EPS of $0.38 beating estimates by +0.02 on revenue of $1.2 billion.

Priceline.com (PCLN): Reported Q1 EPS of $1.70 beating estimates by +0.04 on revenue of $584 million.

·         Futures: Dow -0.9%. S&P -1.2%. Nasdaq -1.0%. Crude -1.3% to $75.77. Gold +0.9% to $1211.40.

·         Asia: Japan -1.1% to 10411.1. Hong Kong -1.4% to 20147. China -1.9% to 2648. India -1.1% to 17142.

·         Europe:  London -1.8%. Paris -2.5%. Frankfurt +4.0%.