MORNING COFFEE

Freddie Mac Bet Against Homeowners. According to a NPR-ProPublica report  Freddie Mac's (FMCC) investment division placed billions of dollars of investments against homeowners who were trying to refinance their mortgages. The report bring up questions about a conflict of interest amid reports that Freddie Mac has been turning down refinancing requests in order to benefit its prop trades.

Upgrades

Nike (NKE): Argus raised their rating from Hold to Buy and placed a target price of $118.00 on the company.

Under Armour (UA): Needham raised their rating from Hold to Buy and placed a target price of $86.00 on the company.

Downgrades

Pep Boys (PBY): BB&T Capital Markets lowered their rating from Hold to Underweight.

Pep Boys (PBY): The Benchmark Company lowered their rating from Buy to Hold.

RadioShack (RSH): Caris lowered their rating from Average to Below Average.

RadioShack (RSH): Raymond James lowered their rating from Outperform to Underperform.

Monster Beverage Co (MNST): CLSA lowered their rating from  Buy to Outperform and lowered their target price from $120.00 to $112.00.

Magna International (MGA): JP Morgan lowered their rating from Overweight to Neutral and lowered their target price from $54.00 to $48.00.

Coverage Initiated

Zillow (Z): The Benchmark Company initiated coverage with a Buy rating and target price of $35.00.

BB&T Corp (BBT): Wunderlich initiated coverage with a Buy rating and target price of $34.00.

Earning Reports

Archer-Daniels (ADM): Reported EPS of $0.51 missing estimates by -$0.26.

Eli Lilly (LLY): Reported EPS of $0.87 beating estimates by +$0.07.

Mattel (MAT): Reported EPS of $1.07 beating estimates by +$0.06.

Pfizer (PFE): Reported EPS of $0.50 beating estimates by +$0.03.

U.S. Steel (X): Reported EPS of -$1.14 missing estimates by -$0.30.

UPS (UPS): Reported EPS of $1.28 beating estimates by +$0.03.

Markets: 
Futures at 8:58: Dow +0.37%. S&P +0.49%. Nasdaq +0.49%. Crude +1.48% to $100.23 Gold +0.79% to $1744.40. 

Europe: London +0.84%. Paris +1.80%. Frankfurt +1.36%. 

Asia: Japan +0.11% to 8803. Hong Kong +1.14% to 20390. China +0.33% to 2,292.61. India +1.96% to 17194. 

MORNING COFFEE

U.S. Bank Exposure to GIIPS Exceeds $80B. According to a report in the New York Times five major banks have over $80 billion in exposure to EU GIIPS.  The banks holding the GIIPS include Bank of America (BAC), Citigroup (C), Goldman Sachs  (GS), JP Morgan (JPM), and Morgan Stanley (MS).

Upgrades

Saint Joe Co. (JOE): Raymond James raised their rating from Market Perform to Outperform. Pre-market: 16.50 -0.77 (-4.46%)

Citigroup (C): Goldman Sachs raised their rating from Neutral to Buy and raised their target price from $35.00 to $36.00. Pre-market: 30.51 -0.36 (-1.17%)

Microsoft (MSFT): Atlantic Securities raised their rating from Neutral to Overweight and raised their target price from $30.00 to $36.00. Pre-market: 29.01 -0.22 (-0.75%)

Downgrades

JP Morgan Chase (JPM): Goldman Sachs lowered their rating from Conviction Buy to Buy and lowered their target price from $42.00 to $41.00. Pre-market: 36.66 -0.55 (-1.48%)

Bank of America (BAC): Goldman Sachs lowered their rating from Buy to Neutral and placed a target price of $8.00 on the company. Pre-market: 7.13 -0.16 (-2.19%)

Kellogg Co (K): JP Morgan lowered their rating from Overweight to Neutral and lowered their target price from $62.00 to $48.00. Pre-market: 49.03 -0.70 (-1.41%)

Proctor & Gamble (PG): UBS lowered their lowered their rating from Buy to Neutral and lowered their target price from $72.00 to $66.00. Pre-market: 63.82 -0.48 (-0.75%)

Proctor & Gamble (PG): BMO Capital lowered their lowered their rating from Overweight to Market Perform and placed a target price of $68.00 on the company. Pre-market: 63.82 -0.48 (-0.75%)

Coverage Reiterated/Price Target Changed

Proctor & Gamble (PG): Hilliard Lyons reiterated their Long-Term Buy rating and lowered their target price from $81.00 to $79.00. Pre-market: 63.82 -0.48 (-0.75%)

Earnings Reports

Koninklijke Philips Electronics (PHG): Reported EPS of -$0.17 missing estimates by $0.38. Pre-market: 19.84 -0.53 (-2.60%)

Wolverine (WWW): Reported EPS of $0.47 beating estimates by +$0.03.

Markets: 
Futures at 8:45: Dow -0.63%. S&P -0.86%. Nasdaq -0.78%. Crude -0.70% to $98.88. Gold -0.47% to $1724.20. 

Europe: London -1.07%. Paris -1.37%. Frankfurt -1.26%. 

Asia: Japan -0.54% to 8793. Hong Kong -1.66% to 20160. China -1.47% to 2285. India -2.14% to 16863. 

MORNING COFFEE

Fed Questioning QE3. Reports indicate that the Fed policy makers want more insight into the direction of the economy and inflation before deciding on whether to go ahead with QE3. The FOMC is due to meet next week.

Upgrades

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

Advance Auto Parts (AAP): Cleveland Research raised their rating from Neutral to Buy.

Downgrades

Intel (INTC): Kaufman Bros lowered their rating from Buy to Hold and raised their target price from $25.00 to $26.00.

Google (GOOG): BGC Financial lowered their rating from Buy to Hold and raised their target price from $650.00 to $625.00.

BlackRock (BLK): Citigroup lowered their rating from Buy to Hold.

Coverage Initiated

Dick’s Sporting Goods (DKS): Northland Securities initiated coverage with a Market Perform rating and placed a target price of $45.00 on the company.

Apple (AAPL): FBR Capital initiated coverage with an Outperform rating and placed a target price of $500.00 on the company.

Under Armour (UA): Northland Securities initiated coverage with a Market Perform rating and target price of $80.00.

Coverage Reiterated/Price Target Changed

Google (GOOG): The Benchmark Company reiterated their Hold rating and lowered their target price from $700.00 to $625.00.

Earning Reports

American Express (AXP): Reported EPS of $1.01 beating estimates by +$0.05.

Google (GOOG): Reported EPS of $9.50 missing estimates by -$0.95.

IBM (IBM): Reported EPS of $4.71 beating estimates by +$0.09.

Intel (INTC): Reported EPS of $0.68 beating estimates by +$0.04.

Microsoft (MSFT): Reported EPS of $0.78 beating estimates by +$0.02.

General Electric (GE): Reported EPS of $0.39 beating estimates by +$0.01.

Markets: 
Futures at 9:05: Dow -0.15%. S&P -0.21%. Nasdaq -0.04%. Crude -0.64% to $99.75. Gold -0.11 to $1652.60. 

Europe: London -0.04%. Paris -0.42%. Frankfurt -0.12%. 

Asia: Japan +1.47% to 8766. Hong Kong +0.84% to 20110. China +1.0% to 2319. India +0.57% to 16739. 

EARNING REPORTS

Google (GOOG) Q4 EPS $9.50 vs. $10.49 est, Q4 Revenues $8.13B (ex-tac) vs. $8.4B est. After Hours: 578.80 -60.77 (-9.50%)


Intel (INTC) Q4 EPS $0.68 (non-gaap) vs. $0.61 est., Q4 Revs: $13.9B vs. $13.7B est. After Hours: 26.16 +0.53 (2.07%)


IBM (IBM) Q4 EPS $4.71 non-gaap vs $4.62 Est. Revs $29.5B vs $29.7B. After Hours: 184.34 +3.82 (2.12%)


American Express (AXP) Q4 EPS $1.01 vs $0.98 Est. Q4 Revenues $7.7B vs. $7.9B Est. After Hours: 50.35 -0.60 (-1.18%)

MORNING COFFEE

Apple To Make Big Announcement.  Apple will be hosting an event at the Guggenheim Museum in New York at 10:00am.  Analysts are expecting Apple to make an announcement about school textbooks for the iPad. Reports say that former CEO Steve Jobs prior to his death was working to radically change the textbook market.  His work was on ways to circumvent the state certification process for textbook sales by having Apple release textbooks for free on the iPad.  He also reportedly told News Corp. chairman Rupert Murdoch that paper textbooks could be made obsolete by the iPad.  Pre-market: 430.36 +1.25 (0.29%)

Tech Giants In Spotlight Today. Tech giants Google (GOOG), IBM (IBM), Intel (INTC), and Microsoft (MSFT) will be in the spotlight today as each company releases their earnings.  Google is forecast to post a 19% climb in EPS to $10.45 on a 31% jump in revenue to $8.4B; IBM's estimates are EPS of $4.62 and $29.7B. Intel's expected to post EPS of $0.64 and $13.7B and Microsoft's EPS is expected to be fall by a penny to $0.76, with revenue rising to $21B. GOOG Pre-market: 637.25 +4.34 (0.69%), IBM Pre-market: 181.70 +0.63 (0.35%), INTC Pre-market: 25.52 +0.13 (0.51%), MSFT Pre-market: 28.26 +0.03 (0.11%)

Upgrades

Advance Auto Parts (AAP): Credit Suisse raised their rating from Neutral to Outperform and placed a target price of $80.00 on the company.

Downgrades

Douglas Dynamics (PLOW): Oppenheimer lowered their rating from Outperform to Perform.

Coverage Initiated

Phillip Morris International (PM): CLSA initiated coverage with an Outperform rating and target price of $86.00. Pre-market: 73.70 +0.44 (0.60%)

Zimmer Holdings (ZMH): Cowen initiated coverage with a Neutral rating.

Stryker (SYK): Cowen initiated coverage with an Outperform rating. Pre-market: 51.77 -0.40 (-0.77%)

Coverage Reiterated/Price Target Changed

Xilinx (XLNX): Mizuho reiterated their Neutral rating and raised their target price from $28.00 to $36.00. Pre-market: 36.96 +1.66 (4.70%)

Earning Reports

eBay (EBAY): Reported EPS of $0.60 beating estimates by +$0.03. Pre-market: 31.41 +1.07 (3.53%)

Xilinx (XLNX): Reported EPS of $0.41 beating estimates by +$0.04. Pre-market: 36.96 +1.66 (4.70%)

Bank of America (BAC): Reported EPS of $0.16 missing estimates by -$0.03. Pre-market: 7.20 +0.40 (5.96%)

BlackRock (BLK): Reported EPS of $3.06 beating estimates by +$0.04. Pre-market: 186.05 -1.75 (-0.93%)

Morgan Stanley (MS): Reported EPS of -$0.14 beating estimates by +$0.48. Pre-market: 18.62 +1.27 (7.32%)

Union Pacific (UNP): Reported EPS of $1.99 beating estimates by +$0.18. Pre-market: 113.71 +3.89 (3.54%)

United Health (UNH): Reported EPS of $1.17 beating estimates by +$0.14. Pre-market: 54.04 +0.10 (0.19%)

Markets: 
Futures at 7:00: Dow +0.29%. S&P +0.45%. Nasdaq +0.61%. Crude +1.09% to $101.69. Gold +0.04% to $1660.50. 

Europe: London +0.54%. Paris +1.72%. Frankfurt +0.83%. 

Asia: Japan +1.04% to 8640. Hong Kong +1.30% to 19943. China +1.31% to 2296. India +1.17% to 16644.