Molycorp, Inc. (NYSE: MCP) is a call that might feel like an eon ago since it was on Tuesday. Still, the call stopped what had been a mudslide in its shares from the week before and this was before everything in North Africa hit the fan. It was J.P.Morgan which raised the rating from Neutral to Overweight and the firm took a $36 target up to $65 based on its prospects out to 2014. Considering this week was a tough one, Molycorp closed out the week at $48.65. That was very close to its week highs and compared to a close of $44.63 last Friday. Whether a bubble in rare earth elements exists or not, this was an impressive call that lent support to shares all week after such a large slide from its secondary offering and then again after a key insider sale that hit the tape after the fact.
Wells Fargo & Company (NYSE: WFC) was a very interesting call on Friday. After a slide all week, Goldman Sachs came to the rescue of the money-center banking giant by adding Wells Fargo to the prized Conviction Buy List after having previously been “Neutral” on the bank. The firm even raised the target from $36.00 to $38.00. As part of the call, Citigroup Inc. (NYSE: C) was cut from Buy to Neutral based upon a lack of catalysts. The thought on Wells Fargo is that it has perhaps the best core operating profit trends with dividend hikes and share buybacks likely. Wells Fargo closed out last week at $32.64 and it slid down to as low as $30.80 mid-week. This drove shares much higher than the average banking giant and shares closed up 3.05% at $32.40. As this is Warren Buffett’s top bank by far and with Goldman Sachs being under Buffett’s preferred shares, Berkshire Hathaway saw a gain in position value on Wells Fargo of nearly $330 million on Friday alone.
The standout call of all was one that will drive shares of United States Oil (NYSE: USO) and the ProShares Ultra Oil & Gas (NYSE: DIG) exchange-traded products much higher if it happens and the call will ultimately wipe out the settings PowerShares DB Crude Oil Double Short ETN (NYSE: DTO) is it comes true. Frankly, the report seemed to take an entirely exaggerated point based upon much different starting points and endpoints. Still, it grabbed the attention of everyone. Nomura laid out the case that could take oil to $220 per barrel. Let’s all just hope the call was as big of an exaggeration as we think.
As you have noticed, the research calls here are all very different. It turned out this week that the big bias here was a bullish bias due to the fact that it was a week full of turmoil and these were the huge standout research calls we identified. There were other big calls seen as well. These were just the ones that made the grade here for us.
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JON C. OGG