MORNING COFFEE

Berkshire’s Successor Quits. In after hours trading yesterday shares of Berkshire Hathaway (BRKA/BRKB) fell on news that a possible successor to Warren Buffet had quit.   David Sokol, one of the candidates to succeed Warren Buffett as head of the company, has resigned amid stock-trading revelations. It has been revealed that Sokol bought about 96,000 Lubrizol (LZ) shares in January, just before recommending the company as a takeover target.  On March 14 Berkshire agreed to buy Lubrizol for $9 billion and according to reports Buffet learn of Sokol’s purchase a few days later.  Sokol’s purchase ahead of Berkshire’s purchase may have given Sokol a profit of about $3 million. Pre-market: 83.94 -1.52 (-1.78%)

J&J To Restructure. Johnson & Johnson (JNJ) announced that it will be restructuring its consumer business, while focusing more on the company’s McNeil Consumer Healthcare unit.  J&J has had a series of embarrassing recalls of popular over-the-counter products. The company said that the restructuring will allow it to "give focused attention to quality and compliance, and the critical task of restoring McNeil Consumer Healthcare brands." Pre-market: 59.34 -0.04 (-0.07%)

Upgrades

UnitedHealth (UNH): Oppenheimer raised their rating from Underperform to Perform and raised their target price from $29.00 to $49.00.

CIGNA (CI): Oppenheimer raised their rating from Perform to Outperform and raised their target price from $29.00 to $49.00.

Pep Boys (PBY): Stifel Nicolaus raised their rating from Hold to Buy and placed a target price of $17.00 on the company.

Downgrades

Aetna (AET): Oppenheimer lowered their rating from Outperform to Perform.

Bristol-Myers (BMY): Jefferies lowered their rating from Buy to Hold and placed a target price of $28.50 on the company.

Coverage Reiterated/Price Target Changed

Juniper Networks (JNPR): Argus reiterated their Buy rating and raised their target price from $44.00 to $49.00.

Sotheby's (BID): Stifel Nicolaus reiterated their Buy rating and raised their target price from $50.00 to $58.00.

WellPoint (WLP): Oppenheimer reiterated their Outperform rating and raised their target price from $65.00 to $83.00.

Intel (INTC): FBR Capital reiterated their Market Perform rating and lowered their target price from $27.00 to $25.00.

Earning Reports

CarMax (KMX): Reported EPS of $0.39 beating estimates by +$0.01. Pre-market: 34.19 -0.40 (-1.16%)

Mosaic (MOS): Reported FQ3 EPS of $1.21 beating estimates by +$0.14 on revenue of $2.21 billion, beating estimates by +$0.12 billion. Pre-market: 80.00 -0.45 (-0.56%)

·         Futures at 7:00: Dow 0.0%. S&P -0.1%. Nasdaq -0.1%. Crude +0.8% to $105.12. Gold +0.2% to $1427.10.

·         Europe: London -0.2%. Paris -0.4%. Frankfurt 0.0%.

·         Asia: Japan +0.5% to 9755.1. Hong Kong +0.3% to 23528. China -0.9% to 2930. India +0.8% to 19445.

MORNING COFFEE

BlackRock To Be Added To S&P Index. BlackRock Inc. (BLK) is scheduled to be added to the S&P 500 Index on Friday.  The company will be replacing Genzyme (GENZ) which is scheduled to be acquired by Sanofi-Aventis' (SNY). The news has BlackRock shares up in the Pre-market.  Pre-market: 196.65 +10.15 (5.44%)

Downgrades

EOG Resources (EOG): Ticonderoga lowered their rating from Buy to Neutral.

Lennar (LEN): Ticonderoga lowered their rating from Buy to Neutral.

Coverage Initiated

OfficeMax (OMX): Caris & Company initiated coverage with a Buy rating and target price of $17.00.

Best Buy (BBY): Caris & Company initiated coverage with an Above Average rating and target price of $36.00.

RadioShack (RSH): Caris & Company initiated coverage with an Average rating and target price of $16.00.

Gamestop (GME): Caris & Company initiated coverage with a Buy rating and target price of $30.00.

Coverage Reiterated/Price Target Changed

Apollo Group (APOL): RBC Capital Markets reiterated their Sector Perform rating and lowered their target price from $45.00 to $42.00.

Earning Reports

Family Dollar Stores (FDO): Reported FQ2 EPS of $0.98 beating estimates by +$0.01 on revenue of $2.26 billion, in-line with estimates. Pre-market: 53.40 +1.00 (1.91%)

·         Futures at 7:00: Dow +0.4%. S&P +0.5%. Nasdaq +0.65%. Crude -0.5% to $104.28. Gold +0.2% to $1419.

·         Europe: London +0.6%. Paris +0.9%. Frankfurt +1.6%.

·         Asia: Japan +2.6% to 9709. Hong Kong +1.7% to 23451. China -0.1% to 2956. India +0.9% to 19290.

MORNING COFFEE

Saudi Arabia To Increase Oil Rigs By 28%. Reports say that Saudi Arabia, the world's top oil producer, is looking to increase the number of oil rigs it has by 28% to 118.  Saudi run Saudi Aramco met with Halliburton (HAL) and other oil service companies over the weekend to discuss the plan.

Wal-Mart Moves To Block Lawsuit. Wal-Mart (WMT) will be going to court today in an attempt to prevent a sex discrimination lawsuit from becoming a class-action case.  At the Supreme Court hearing today a small group of female employees who are suing for sex discrimination in pay and promotions are seeking represent a nationwide suit that could include up to 1.5 million.   Wal-Mart analysts say that if the judges allow the case to become a class action suit a title wave of cases could swamp companies.

Coverage Reiterated/Price Target Changed 

Phillips-Van Heusen (PVH): Brean Murray reiterated their Buy rating and raised their target price from $70.00 to $80.00.

Earning Reports

Apollo Group (APOL): Reported FQ2 EPS of $0.83 beating estimates by +$0.14 on revenue of $1.05 billion, beating estimates by +$0.03 billion. Sees FY'11 revenue of $4.65-4.75. Pre-market: 39.01 -3.34 (-7.89%)

Lennar (LEN): Reported FQ1 EPS of $0.14 beating estimates by +$0.19 on revenue of $557.9 million, beating estimates by +$50 million. Pre-market: 20.25 +0.50 (2.53%)

McCormick (MKC): Reported Q1 EPS of $0.57 beating estimates by +$0.03 on revenue of $803 million.  Pre-market: 49.89 +0.28 (0.56%)

Phillips-Van Heusen (PVH): Reported Q4 EPS of $0.93 beating estimates by +$0.11 on revenue of $1.4 billion, beating estimates by +$0.03 billion. Pre-market: 62.00 +1.83 (3.04%)

·         Futures at 7:00: Dow +0.1%. S&P +0.1%. Nasdaq +0.2%. Crude -0.7% to $103.29. Gold -0.5% to $1412.90.

·         Europe: London -0.3%. Paris -0.6%. Frankfurt -0.8%.

·         Asia: Japan -0.2% to 9459. Hong Kong 0.0% to 23060. China -0.9% to 2958. India +0.9% to 19121.

MORNING COFFEE

Democrats To Offer GOP $20 Billion In Cuts. Reports say that Democrats are putting together a proposal to offer the Republicans another $20 billion in spending cuts for the current year.  The cuts would be in addition to the $10 billion in cuts already enacted and would be more than the White House and Senate Democrats had previously offered.  This is far less than what the Republican controlled House has already passed.  Their bill cuts $61 billion in spending.  The Federal government has been operating without a budget for nearly a year.  The than Democratically controlled House and Senate never took up the budget prior to the elections, due to fears that if they made cuts, it would hurt their chances in the election. The government will run out of money again April 8^th and even if a budget is agreed upon, an all new budget is due in October.

Upgrades

AT&T (T): Robert W. Baird raised their rating from Neutral to Outperform and raised their target price from $30.00 to $34.00.

Leap Wireless (LEAP): Robert W. Baird raised their rating from Neutral to Outperform and raised their target price from $14.00 to $19.00.

MetroPCS  (PCS): Robert W. Baird raised their rating from Neutral to Outperform and raised their target price from $14.00 to $22.00.

Verizon (VZ): Robert W. Baird raised their rating from Neutral to Outperform and raised their target price from $36.00 to $42.00.

Downgrades

Franklin Resources (BEN): Ticonderoga lowered their rating from Buy to Neutral.

L-3 Comms (LLL): Oppenheimer lowered their rating from Perform to Underperform and lowered their target price from $85.00 to $83.00.

Coverage Initiated         

Leap Wireless (LEAP): Collins Stewart initiated coverage with a Hold recommendation.

MetroPCS (PCS): Collins Stewart initiated coverage with a Buy recommendation and target price of $20.00.

·         Futures at 8:50: Dow +0.1%. S&P +0.1%. Nasdaq +0.15%. Crude -0.5% to $104.84. Gold -0.8% to $1415.30.

·         Europe: London +0.1%. Paris +0.2%. Frankfurt -0.2%.

·         Asia: Japan -0.6% to 9479. Hong Kong -0.4% to 23068. China+0.2% to 2984. India +0.7% to 18943.

MORNING COFFEE

U.S. Economy Grow 3.1%. The U.S Commerce Department reported that the U.S. economy grew more than economist had expected in the fourth quarter.  Economist had been looking for the economy to grow only 2.9%.  This comes just after the Fed said that the economy seems to be on firmer footing.  U.S. businesses are increasing their spending and production to meet consumer’s demand, while corporate profits increased 3.3%.  The first quarter seems to be on pace to maintain this growth rate, but higher oil prices could lower consumer demand and slow the economic recovery.

Upgrades

CarMax (KMX): Robert W. Baird raised their rating from Neutral to Outperform and raised their target price from $38.00 to $40.00.

Downgrades

Urban Outfitters (URBN): Janney Montgomery Scott lowered their rating from Buy to Neutral and placed a target price of $30.00 on the company.

Research In Motion (RIMM): Robert W. Baird lowered their rating from Neutral to Underperform and lowered their target price from $60.00 to $47.00.

Coverage Initiated

Harley-Davidson (HOG): Wedbush initiated coverage with an Outperform rating and target price of $48.00.

Coverage Reiterated/Price Target Changed

Oracle (ORCL): Stifel Nicolaus reiterated their Buy rating and raised their target price from $36.00 to $38.00.

Accenture (ACN): Stifel Nicolaus reiterated their Buy rating and raised their target price from $59.00 to $65.00.

Best Buy (BBY): RBC Capital Markets reiterated their Top Pick rating and lowered their target price from $42.00 to $38.00.

Morgan Stanley (MS): Oppenheimer reiterated their Outperform rating and lowered their target price from $33.00 to $31.00.

Earning Reports

Accenture (ACN): Reported FQ2 EPS of $0.75 beating estimates by +$0.03 on revenue of $6.1 billion, beating estimates by +$0.3 billion. Pre-market: 56.00 +4.04 (+7.78%)

Darden Restaurants (DRI): Reported FQ3 EPS of $1.08 beating estimates by +$0.03 on revenue of $1.98 billion, in-line with estimates. Pre-market: 48.00 -0.01 (-0.02%)

Oracle (ORCL): Reported FQ3 EPS of $0.54 beating estimates by +$0.04 on revenue of $8.76 billion, beating estimates by +$0.1 billion. Pre-market: 33.68 +1.54 (4.79%)

Research In Motion (RIMM): Reported Q4 EPS of $1.78 beating estimates by +$0.02 on revenue of $5.56 billion, missing estimates by -$0.08 billion.  Sees Q1 EPS of $1.47-1.55 vs. consensus estimate of $1.65, noting customers are shifting to lower-priced models. Pre-market: 57.13 -6.96 (-10.86%)

·         Futures at 9:14: S&P +0.15%. Nasdaq +0.25%. Dow +0.13%. Crude +0.09% to $105.69. Gold -0.07% to $1433.90.

·         Europe: London +0.4%. Paris +0.2%. Frankfurt +0.5%.

·         Asia: Japan +1.1%. Hong Kong +1.1%. China +1.1%. India +2.6%.

MORNING COFFEE

Investors Flock To Gold On Geopolitical News.  Gold nearly hit its record high yesterday, due to the crises in the Middle East and Portugal default worries.  “The entire Middle East is spinning out of control with civil war in Libya, protest in Bahrain, Yemen and Oman, Hamas is firing rockets into Israel, Portugal seems to be on the verge of defaulting on their debt and in the U.S., there is speculation that the U.S. might extend its $600B bond purchase program following record low U.S. new-home sales.” Premarket $1,441.30 +0.2%.

Upgrades

Arctic Cat (ACAT): KeyBanc Capital Markets raised their rating from Hold to Buy and placed a target price of $18.00 on the company.

Red Hat (RHT): Robert W. Baird raised their rating from Neutral to Outperform and placed a target price of $50.00 on the company.

Downgrades

Bank of America (BAC): FBR Capital lowered their rating from Outperform to Market Perform and lowered their target price from $18.00 to $15.00.

Coverage Reiterated/Price Target Changed

General Mills (GIS): RBC Capital Markets reiterated their Outperform rating and raised their target price from $38.00 to $41.00.

Phillips-Van Heusen (PVH): Brean Murray reiterated their Buy rating and lowered their target price from $85.00 to $70.00.

Earning Reports

ConAgra (CAG): Reported EPS of $0.50 beating estimates by +$0.04.

Paychex (PAYX): Reported FQ3 EPS of $0.36 beating estimates by +$0.01 on revenue of $531 million, beating estimates by +$3 million.

Red Hat (RHT): Reported Q4 EPS of $0.26 beating estimates by +$0.04 on revenue of $245 million, beating estimates by +$8 million.

·     SAIC (SAI): Reported Q4 EPS of $0.36 beating estimates by +$0.07 on revenue of $2.77 billion, in-line

    with estimates.

·         Futures at 7:00: Dow +0.4%. S&P +0.6%. Nasdaq +0.7%. Crude +0.7% to $106.53. Gold +0.2% to $1441.30.

·         Europe: London +0.8%. Paris +0.6%. Frankfurt +0.7%.

·         Asia: Japan -0.1% to 9435. Hong Kong +0.4% to 22915. China -0.1% to 2947. India +0.8% to 18351.

MORNING COFFEE

Rare Earth Miners Post Huge Gains. Shares of rare earth miners posted huge gains yesterday, after news reports that Molycorp would hit its Q1 sales targets and that volume from China had decreased. Rare earth minerals are used in manufacturing many products, including electronics. In yesterday's trading, Molycorp (MCP) +17.7%, Avalon Rare Metals (AVL) +13.2%, China GengSheng Minerals (CHGS) +63.45%, China Shen Zhou Mining & Resources (SHZ) +28.7%, Rare Element Resources (REE) +24.1%, Market Vectors Rare Earth Strat Metals ETF (REMX) +3.7%.

Upgrades

Jefferies Group (JEF): Ticonderoga raised their rating from Neutral to Buy and placed a target price of $30.00 on the company.

Coverage Initiated

Inergy (NRGY): Robert W. Baird initiated coverage with a Neutral rating and target price of $42.00.

Coverage Reiterated/Price Target Changed

Adobe Systems (ADBE): ISI Group reiterated their Neutral rating and raised their target price from $34.00 to $37.00.

Discover Financial Services (DFS): FBR Capital reiterated their Outperform rating and raised their target price from $22.00 to $25.00.

Earning Reports

General Mills (GIS): Reported FQ3 EPS of $0.56 in-line on revenue of $3.65 billion, missing estimates by-$0.04 billion.

Adobe (ADBE): Reported FQ1 EPS of $0.58 beating estimates by +$0.01 on revenue of $1.02 billion, in-line with estimates.

Cintas (CTAS): Reported FQ3 EPS of $0.41 beating estimates by +$0.05 on revenue of $938 million, beating estimates by +$30 million.

Discover Financial Services (DFS): Reported FQ1 EPS of $0.84 beating estimates by +$0.27.

Jabil Circuit (JBL): Reported FQ2 EPS of $0.54 beating estimates by +$0.03 on revenue of $3.92 billion, in-line with estimates.

·         Futures at 7:00: Dow +0.2%. S&P +0.3%. Nasdaq 0.0%. Crude +0.5% to $105.53. Gold +0.3% to $1432.40.

·         Europe: London +0.5%. Paris +0.5%. Frankfurt +0.3%.

·         Asia: Japan -1.6% to 9449. Hong Kong -0.1% to 22825. China +1.0% to 2949. India +1.2% to 18206.

·