MORNING COFFEE

SEC to Charge Banks over Mortgage Bonds. Reports say the SEC has sent Wells Notices to Goldman Sachs (GS), JPMorgan (JPM), and Wells Fargo (WFC) relating to the sale of sub-prime mortgage bonds. The notices are usually an indication that SEC attorneys have recommended that the agency file civil suits.

DOJ launches Criminal Probe Aimed at Banks. The DOJ is investigating the world largest banks to see if they manipulated the Libor inter-bank lending rate.

Upgrades

Chevron (CVX): Deutsche Bank raised their rating from Hold to Buy and raised their target price for $115.00 to $130.00.

Downgrades

Cablevision (CVC): Collins Stewart lowered their rating from Buy to Neutral.

Ecolabs (ECL): JP Morgan lowered their rating from Overweight to Neutral.

Coinstar (CSTR): JP Morgan lowered their rating from Overweight to Neutral and placed a target price of $62.00 on the company.

ITT Educational Services (ESI): Deutsche Bank lowered their rating from Hold to Sell and lowered their target price from $66.00 to $50.00.

Earning Reports

Costco (COST): Reported EPS of $0.90 beating estimates by +$0.03.

Joy Global (JOY): Reported EPS of $1.33 missing estimates by -$0.02.

Staples (SPLS): Reported EPS of $0.41 in-line with estimates.

Markets: 
Futures at 9:11: Dow +0.05%. S&P +0.08%. Nasdaq +0.13%. Crude -0.02% to $106.54. Gold -0.029% to $1783.10. 

Europe: London -0.05%. Paris +0.54%. Frankfurt +0.53%. 

Asia: Japan +0.01% at 9723. Hong Kong +0.52% to 21680. China -0.95% to 2428. India +0.12% to 17753. 

MORNING COFFEE

Eurozone Heading for Recession. The European Commission has forecasts a mild recession for the eurozone, estimating that the eurozone economies will shrink by -0.3% this year. In November the Commission had expected the region to grow by +0.5%. One of the sharpest country revisions was Spain’s economy which is expected to -1.0% vs. the prior forecast for growth of +0.7%.

Upgrades

DirecTV (DTV): Atlantic Equities raised their rating from Neutral to Overweight and raised their target price from $53.00 to $55.00.

Kellogg (K): Deutsche Bank raised their rating from Hold to Buy and raised their target price from $53.00 to $55.00. Pre-market: 53.00 +0.47 (0.89%)

Coverage Initiated

Intuit (INTU): Stifel Nicolaus initiated coverage with a Hold rating. Pre-market: 62.29 +1.37 (2.25%)

Boeing (BA): Stifel Nicolaus initiated coverage with a Hold rating. Pre-market: 76.00 -0.06 (-0.08%)

Earning Reports

Caribou Coffee (CBOU): Reported EPS of $0.14 beating estimates by +$0.01. Pre-market: 18.23 +0.64 (3.64%)

Ensco (ESV): Reported EPS of $0.99 beating estimates by +$0.03. Pre-market: 57.12 +0.59 (1.04%)

Checkpoint Systems (CKP): Reported EPS of -$0.09 missing estimates by -$0.06.

DISH Network (DISH): Reported EPS of $0.70 beating estimates by +$0.09. Pre-market: 29.80 +0.64 (2.19%)

Hormel Foods (HRL): Reported EPS of $0.48 in-line with estimates.

Kohl’s (KSS): Reported EPS of $1.81 beating estimates by +$0.01. Pre-market: 50.47 -1.72 (-3.30%)

Sears Holdings (SHLD): Reported EPS of $0.54 missing estimates by -$0.24. Pre-market: 58.77 +6.69 (12.85%)

Target (TGT): Reported EPS of $1.49 beating estimates by +$0.09. Pre-market: 53.15 +0.18 (0.34%)

Teleflex (TFX): Reported EPS of $1.07 beating estimates by +$0.03. Pre-market: 60.99 -1.36 (-2.18%)

Markets: 
Futures at 8:34: Dow +0.15%. S&P +0.09%. Nasdaq +0.24%. Crude +0.37% to $106.67. Gold +0.51% to $1780.40. 

Europe: London +0.30%. Paris +0.13%. Frankfurt -0.37%. 

Asia: Japan +0.44% to 9596. Hong Kong -0.78% to 21381. China +0.25% to 2410. India -0.37% to 18079. 

MORNING COFFEE

J&J CEO to Retire. Johnson & Johnson (JNJ) CEO Bill Weldon announced that he will be retiring.  The company has had a string of product recalls. Alex Gorsky, head of medical devices and diagnostics, will succeed him.

IAEA Leaves Empty Handed. After two days, the IAEA announced that they have once again been blocked from inspecting Iran’s nuclear-related military base.  In a statement meant to show that Iran was not going to back down on their nuclear program, Iran said it would consider preemptive action if it felt threatened.

Upgrades

Mosaic (MOS): Cacaccord raised their rating from Hold to Buy and raised their target price from $62.00 to $73.00. Pre-market: 59.25 +2.34 (4.11%)

Downgrades

Dell (DELL): Needham lowered their rating from Buy to Hold. Pre-market: 17.03 -1.18 (-6.48%)

Dell (DELL): Citigroup lowered their rating from Buy to Neutral and lowered their target price from $20.00 to $19.00. Pre-market: 17.03 -1.18 (-6.48%)

Wal-Mart (WMT): Raymond James lowered their rating from Strong Buy to Market Perform.

Dow Chemical (DOW): Gilford Securities lowered their rating from Hold to Sell. Pre-market: 34.10 -0.55 (-1.59%)

Medtronic (MDT): Credit Suisse lowered their rating from Outperform to Neutral and lowered their target price from $44.00 to $43.00. Pre-market: 38.20 -0.79 (-2.03%)

Yahoo! (YHOO): CLSA lowered their rating from Strong Buy to Underperform and lowered their target price from $19.00 to $15.00. Pre-market: 14.72 -0.03 (-0.20%)

Coverage Initiated

EOG Resources (EOG): Guggenheim initiated coverage with a Neutral rating and target price of $125.00.

Noble Energy (NBL): Guggenheim initiated coverage with a Buy rating and target price of $122.00.

Devon Energy (DVN): Guggenheim initiated coverage with a Buy rating and target price of $91.00.

Earning Reports

Dell (DELL): Reported EPS of $0.51 missing estimates by -$0.01. Pre-market: 17.03 -1.18 (-6.48%)

Herbalife (HLF): Reported EPS of $0.86 beating estimates by +$0.14. Pre-market: 65.00 +2.54 (4.07%)

Intuit (INTU): Reported EPS of $0.51 beating estimates by +$0.06. Pre-market: 59.48 +1.96 (3.41%)

Dollar Tree (DLTR): Reported EPS of $1.60 beating estimates by +$0.02. Pre-market: 86.00 -2.01 (-2.28%)

MGM Resorts (MGM): Reported EPS of -$0.22 missing estimates by -$0.02. Pre-market: 14.07 -0.12 (-0.85%)

Markets: 
Futures at 8:27: Dow -0.12%. S&P -0.21%. Nasdaq -0.19%. Crude -0.24% to $105.99. Gold -0.10% to $1756.80. 

Europe: London -0.38%. Paris -0.43%. Frankfurt -0.73%. 

Asia: Japan +0.96% to 9554. Hong Kong +0.33% to 21549. China +0.93% to 2404. 

MORNING COFFEE

Wal-Mart Ups Ante In China. Wal-Mart (WMT) announced that it had increased its stake in Chinese e-commerce firm Yihaodian to around 51%.  Wal-Mart sees China’s fast-growing consumer market and is trying to make a presence in the country.  Pre-market: 60.58 -1.90 (-3.04%)

Downgrades

Limited Brands (LTD): Susquehanna lowered their rating from Positive to Neutral and placed a target price of $47.00 on the company.

Infosys (INFY): Credit Suisse lowered their rating from Outperform to Neutral and placed a target price of $47.00 on the company. Pre-market: 59.40 -0.20 (-0.34%)

Under Armour (UA): Needham lowered their rating from Buy to Hold. Pre-market: 84.00 -0.87 (-1.03%)

Allscripts Healthcare (MDRX): Leerink lowered their rating from Outperform to Market Perform.

Lam Research (LRCX): JPMorgan lowered their rating from Overweight to Neutral and placed a target price of $44.00 on the company.

Norfolk Southern (NSC): JPMorgan lowered their rating from Overweight to Neutral and lowered their target price from $87.00 to $77.00. Pre-market: 68.16 -0.65 (-0.94%)

Oracle (ORCL): JMP Securities lowered their rating from Outperform to Market Perform. Pre-market: 28.70 -0.09 (-0.31%)

Earning Reports

Cracker Barrel (CBRL): Reported EPS of $1.20 beating estimates by +$0.07. Pre-market: 56.00 +0.37 (0.67%)

Home Depot (HD): Reported EPS of $0.50 beating estimates by +$0.07. Pre-market: 48.25 +1.54 (3.30%)

Kraft Foods (KFT): Reported EPS of $0.57 in-line with estimates. Pre-market: 38.40 +0.39 (1.03%)

Medtronic (MDT): Reported EPS of $0.88 beating estimates by +$0.04. Pre-market: 39.31 -0.63 (-1.58%)

RadioShack (RSH): Reported EPS of $0.12 in-line with estimates. Pre-market: 7.90 +0.02 (0.25%)

Wal-Mart (WMT): Reported EPS of $1.44 missing estimates by -$0.02. Pre-market: 60.58 -1.90 (-3.04%)

Markets:
Futures at 8:46: Dow +0.26%. S&P +0.17%. Nasdaq +0.08%. Crude +1.59% to $104.88. Gold +1.34% to $1748.80.

Europe: London -0.29%. Paris -0.55%. Frankfurt -0.66%. 

Asia: Japan -0.23% to 9463. Hong Kong +0.25% to 21479. China +0.75% to 2381. India +0.76% to 18429. 

MORNING COFFEE

The stock Market will be closed in observation of President’s Day.

Upgrades

Suncor Energy (SU): Stifel Nicolaus raised their rating from Hold to Buy and placed a target price of $29.00 on the company.

Chesapeake Energy (CHK): Stifel Nicolaus raised their rating from Hold to Buy and placed a target price of $29.00 on the company.

Downgrades

Aeropostale (ARO): Standpoint Research lowered their rating from Buy to Hold.

Crocs (CROX): Standpoint Research lowered their rating from Buy to Hold.

Dell (DELL): Robert W. Baird lowered their rating from Outperform to Neutral.

Coverage Initiated

Foot Locker (FL): Deutsche Bank initiated coverage with a Hold rating and target price of $30.00.

Coverage Reiterated/Price Target Changed

Advance Auto (AAP): UBS reiterated their Buy rating and raised their target price from $90.00 to $96.00.

Applied Materials (AMAT): Needham reiterated their Buy rating and raised their target price from $14.00 to $16.00.

Applied Materials (AMAT): Barclays Capital reiterated their Equal Weight rating and raised their target price from $12.00 to $14.00.

Applied Materials (AMAT): Stifel Nicolaus reiterated their Buy rating and raised their target price from $14.00 to $16.00.

Apple (APPL): Oppenheimer reiterated their Outperform rating and raised their target price from $510.00 to $570.00.

MORNING COFFEE

Moody’s Gives Banks Downgrade Warnings. The rating agency Moody's announced that it could cut the credit ratings of 17 global banks and securities firms.  The possible downgrades are due to funding issues, regulatory issues and a difficult operating environment. U.S. banks under review include Bank of America (BAC), Citigroup (C), Goldman Sachs (GS), JPMorgan Chase (JPM) and Morgan Stanley (MS).

Upgrades

Zillow (Z): Craig-Hallum raised their rating from Sell to Hold and placed a target price of $35.00 on the company. Pre-market: 35.65 +1.66 (4.88%)

Polo Ralph Lauren (RL): Argus raised their rating from Hold to Buy and placed a target price of $202.00 on the company. Pre-market: 173.00 +0.38 (0.22%)

General Mills (GIS): CLSA raised their rating from Underperform to Outperform and raised their target price from $40.00 to $44.00. Pre-market: 39.58 -0.03 (-0.08%)

Expeditors International (EXPD): Jefferies raised their rating from Hold to Buy and raised their target price from $45.00 to $53.00.

Downgrades

Comcast Corp. (CMCSA): Argus lowered their rating from Buy to Hold. Pre-market: 28.25 -0.27 (-0.95%)

Deere & Co. (DE): Wells Fargo lowered their rating from Outperform to Market Perform and lowered their target range from $93-$96 to $90-$93. Pre-market: 84.51 +0.23 (0.27%)

Coverage Initiated

USG (USG): Macquarie initiated coverage with an Underperform rating and target price of $12.00 on the company. Pre-market: 13.79 0.00 (0.00%)

Earning Reports

Blue Nile (NILE): Reported EPS of $0.30 missing estimates by -$0.13. Pre-market: 32.50 -9.33 (-22.30%)

CBS (CBS): Reported EPS of $0.57 beating estimates by +$0.04. Pre-market: 28.70 -0.87 (-2.94%)

Clearwire (CLWR): Reported EPS of -$0.81 missing estimates by -$0.46. Pre-market: 2.14 -0.22 (-9.32%)

Oceaneering Intl (OII): Reported EPS of $0.54 beating estimates by +$0.02.

Skechers USA (SKX): Reported EPS of -$1.18 missing estimates by -$0.96.

Tesla Motors (TSLA): Reported EPS of -$0.69 missing estimates by -$0.06. Pre-market: 33.70 +0.10 (0.30%)

Markets: 

Futures at 7:45: Dow -0.35%. S&P -0.34%. Nasdaq -0.28%. Crude -0.83% to $100.96. Gold -0.71% to $1716.00. 

Europe: London -0.66%. Paris -0.74%. Frankfurt -1.04%. 

Asia: Japan -0.24% to 9238.1. Hong Kong -0.41% to 21277. China -0.42% to 2357. India -0.27% to 18154.