ARM Holdings plc (NASDAQ: ARMH) Raised to Buy at Citigroup.
CareFusion Corporation (NYSE: CFN) Raised to Buy at BofA/ML.
ConocoPhillips (NYSE: COP) Cut to Underperform at Macquarie.
Edison International (NYSE: EIX) Added to US Focus List at Credit Suisse.
General Mills, Inc. (NYSE: GIS) Added to Conviction Buy List at Goldman Sachs.
Goldman Sachs Group Inc. (NYSE: GS) estimates cut to expect a loss by Citigroup.
PDL BioPharma, Inc. (NASDAQ: PDLI) Cut to Sector Perform at RBC.
SAP AG (NYSE: SAP) Started as Buy at Citigroup.
Smithfield Foods Inc. (NYSE: SFD) Raised to Buy at BofA/ML.
Sprint Nextel Corporation (NYSE: S) Cut to Hold at Argus; Removed from U.S. Focus List at Credit Suisse.
Stryker Corporation (NYSE: SYK) Raised to Buy at BofA/ML.
Telefonica, S.A. (NYSE: TEF) Cut to Neutral at Goldman Sachs.
Telecom Italia SpA (NYSE: TI) Cut to Sell at Goldman Sachs.
Tyson Foods Inc. (NYSE: TSN) Raised to Buy at BofA/ML.
Valero Energy Corporation (NYSE: VLO) Raised to Overweight at Barclays.

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Adobe Systems Inc. (NASDAQ: ADBE) Cut to Underperform at RBC.
Alcatel-Lucent (NYSE: ALU) Reiterated Hold at Argus.
ARM Holdings plc (NASDAQ: ARMH) Cut to Underperform at BofA/ML.
Bed Bath & Beyond, Inc. (NASDAQ: BBBY) Raised to Outperform at Oppenheimer.
BP plc (NYSE: BP) Cut to Neutral at Goldman Sachs.
Broadcom Corp. (NASDAQ: BRCM) Started as Market Perform at William Blair.
Brocade Communications Systems, Inc. (NASDAQ: BRCD) Reiterated Hold and Cut estimates at Argus.
China Life Insurance Co. Ltd. (NYSE: LFC) Raised to Outperform at Credit Suisse.
Discovery Communications, Inc. (NASDAQ: DISCA) Raised to Buy at Citigroup.
Edison International (NYSE: EIX) Raised to Outperform at Credit Suisse.
F5 Networks, Inc. (NASDAQ: FFIV) Raised to Outperform at William Blair.
Lender Processing Services (NYSE: LPS) named Bear of the Day at Zacks.
LM Ericsson Telephone Co. (NASDAQ: ERIC) Raised to Buy at BofA/ML.
Macy’s, Inc. (NYSE: M) Reiterated Buy as Value at Zacks.
Niska Gas Storage Partners LLC (NYSE: NKA) Cut to Sector Perform at RBC.
Oracle Corporation (NASDAQ: ORCL) Cut to Sector Perform at RBC.
SLM Corporation (NYSE: SLM) Raised to Outperform as Bull of the Day at Zacks.
Starwood Hotels & Resorts Worldwide Inc. (NYSE: HOT) Cut to Hold at Jefferies.

• Thursday’s top analyst upgrades, downgrades and initiations were in AAP, ADM, COF, CVX, CSCO, CREE, IDTI, ISRG, KGC, NOV, NYX, TEVA, TDW, WYN.

You are invited to join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

BrightSource Energy, Inc. has file a preliminary Form S-1 with the US SEC announcing its intention to conduct an initial public offering. BrightSource was listed as one of our 25 most important alt energy companies last year, and it seems to have lived up to its advance billing. The company has scored a $1.6 billion loan guarantee for its 392-megawatt Ivanpah solar thermal power plant in southern California, and a $168 million investment from Google Inc. (NASDAQ: GOOG). Earlier this month BrightSource received $201 million in venture capital.

The company was founded in 2004 and has completed 14 long-term power purchase agreements to deliver about 2,600 megawatts of electricity to PG&E Corp. (NYSE: PCG) and Southern California Edison, a division of Edison International Inc. (NYSE: EIX). In addition to electricity generation, BrightSource has also developed a solar thermal system to generate steam for use in enhanced oil recovery operations.

BrightSource has not yet specified how many shares would be offered, but did note that 79,135,944 shares of convertible preferred stock would be converted to common stock immediately prior to the IPO. The final number of shares included in the IPO will be determined on the price at the time of the IPO. The underwriters include Goldman Sachs Group Inc. (NYSE: GS), Citigroup Inc. (NYSE: C) and Deutsche Bank AG (NYSE: DG).

According to the prospectus, the company expects to use the proceeds of the IPO for general corporate purposes, including capital expenditures and working capital. It does not appear as though early investors will be cashing out.

BrightSource lost almost $18 million in 2010, equal to its losses in the two previous years combined, and the company expects to continue losing money for the foreseeable future. It takes three to seven years for a solar thermal project to begin commercial operation, so while BrightSource appears to be solid candidate for an IPO, its business could take some time to show profits.

The International Energy Agency has completed a roadmap for development of transportation biofuels through 2050. The IEA projects that by 2050, some 27% of total transportation fuels could be provided by biofuels. To achieve this level of consumption about 250 million acres of arable land would need to be devoted to growing biomass feedstock.

The IEA claims that its goals can be reached without displacing food crops or upsetting biodiversity goals if biofuels costs can be controlled and the conversion efficiency of biomass to fuel can be improved. The cost of meeting the 2050 target is put at $11-$13 trillion, but the IEA notes that “marginal savings or additional costs compared to use of gasoline/diesel are in the range of only +/-1% of total costs for all transport fuels.”

As with so many of the pronouncements from the IEA, government policies are a key factor. The roadmap requires a policy framework that would increase investor confidence and provide for the sustainable expansion of biofuel production. Policy frameworks, incentives, increased R&D, and a sustainable land-use management system to ensure balance with food and timber land also figure into the IEA’s roadmap. Somehow, it’s hard to envision global governments committing to this kind of investment in the current economic climate.

Finally today, the NASDAQ market has sent lead-acid battery maker China Ritar Power a notice of non-compliance and de-listed the company’s stock from trading for failing to file a Form 10-K. The company had announced a delay in its filing because it could not obtain the financial and other information it needed to get the report finished on time. Shares in the company have not traded since April 15th, when they closed at $1.60.

Paul Ausick

Google has announced a $100 million investment in the $2 billion Shepherds Flat wind farm project in Oregon. This follows an earlier investment of $168 million in a concentrated thermal solar project being built by BrightSource Energy in southern California and two other projects, one wind and one solar. Altogether, Google has invested more than $350 million in renewable power generation.

The Shepherds Flat project, the world’s largest wind farm at 845 megawatts, has signed a power purchase agreement with Southern California Edison, a division of Edison International (NYSE: EIX). The developer, Caithness Energy, will use a total of 338 2.5-megawatt turbines supplied by General Electric Co. (NYSE: GE).

Google’s investments are intended to provide a financial return to the internet search giant. The investments are not a feel-good gesture. A wind farm can generate electricity at a cost as low as $0.06/kWh. That same kilowatt-hour sold in southern California can fetch $0.15 or more. That’s a pretty nice return, and that return is what Google is after. At some point, Google may be able to buy power from one of the plants it has invested in, driving down the company’s cost of electricity, which is its second highest expense after staff.

The US Department of Energy has approved a $2.1 billion loan guarantee for Solar Trust of America LLC, which is building the world’s largest solar thermal plant in the southern California desert near the city of Blythe. The plant will eventually generate 1,000 megawatts and Solar Trust has already signed a power purchase agreement Southern California Edison.

The loan guarantee will help build the first two of four planned units at the Blythe project, and is the largest loan made by the DoE. The department has guaranteed more than $21 billion in loans to clean energy projects, and is trying to speed through more applications before the end of the current federal fiscal year, when federal budget cuts threaten to end the program.

Fuel Systems Solutions, Inc. (NASDAQ: FSYS) has completed its $6 million acquisition of NaturalDrive Partners LLC, which was announced earlier this month. Fuel Systems designs, makes, and sells components and systems for gas-powered vehicles. NaturalDrive worked with Fuel Systems on a gas-powered van based on General Motors Co. (NYSE: GM) vehicle, and the acquisition should help Fuel Systems take advantage of the growing interest in natural-gas powered vehicles. Fuel Systems stock is down about -2% today, at $27.41, near the low end of its 52-week range of $23.10-$42.65.

Another clean-tech fuel company, Rentech, Inc. (AMEX: RTK) has acquired a majority stake in ClearFuels Technology Inc., a company in which Rentech already owned a 25% stake. ClearFuels is developing biomass-to-energy projects that would convert sugar cane bagasse to biodiesel. The company also hopes to convert biomass, including cellulosic, feedstock into synthetic jet fuel.

Rentech and ClearFuels already jointly operated a bio-refinery project that received a $23 million federal grant to fund part of a demonstration-scale gasifier. The biofuels business has not been kind to companies trying to get to commercial scale. Many, like Amyris Inc. (NASDAQ: AMRS), Codexis Inc. (NASDAQ: CDXS), and FutureFuel Corp. (NASDAQ: FTFL) have had to diversify into cosmetics and other products to stay afloat.

Rentech shares are up about 0.5% at around noon today, to $1.16, within the 52-week range of $0.69-$1.48.

Finally, in a story related to yesterday’s look at solar equipment makers, Taiwan Semiconductor Manufacturing Co. has just purchased about $100 million worth of equipment from three suppliers, including Applied Materials Inc. (NASDAQ: AMAT) and Lam Research Corp. (NASDAQ: LRCX). Applied Materials took about half the total.

Paul Ausick

Alcatel-Lucent (NYSE: ALU) Reiterated Hold at Argus.
Analog Devices Inc. (NYSE: ADI) Raised to Overweight at JPMorgan.
Barnes & Noble, Inc. (NYSE: BKS) Raised to Neutral at Goldman Sachs.
Dollar Tree, Inc. (NASDAQ: DLTR)  Raised to Overweight at Barclays.
Edison International (NYSE: EIX) Raised to Hold at Citigroup.
Estee Lauder Companies (NYSE: EL) Raised to Outperform as the Bull of the Day at Zacks.
Family Dollar Stores Inc. (NYSE: FDO) Cut to Equal-weight at Barclays.
Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) Raised to Buy at KeyBanc.
Intel Corporation (NASDAQ: INTC) Cut to Hold at S&P Equity Research (late-Monday call).
Linear Technology Corp. (NASDAQ: LLTC) Cut to Neutral at JPMorgan.
Netflix, Inc. (NASDAQ: NFLX) Cut To Equal-weight at Morgan Stanley.
Salesforce.com (NYSE: CRM) Raised to Buy at Jefferies.
Thoratec Corporation (NASDAQ: THOR) Cut to Underperform as Bear of the Day at Zacks.
United States Steel Corporation (NYSE: X) Raised to Buy at Goldman Sachs.

You can join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

It would be well to keep this in mind as press releases burn up pixels announcing new solar plants. This morning, for example, First Solar Inc. (NASDAQ: FSLR) and Southern California Edison, a division of Edison International (NYSE: EIX) announced the signing of a 25-year power purchase agreement for 250 megawatts of electricity from a new solar photovoltaic plant to be built in southern Nevada. Last week, a division of Sempra Energy (NYSE: SRE) signed on for 150 megawatts of solar PV from Suntech Power Holdings Co. (NYSE: STP). In January, Southern California Edison signed three power purchase agreements for 711 megawatts of solar PV-generated power with SunPower Corp. (NASDAQ: SPWRA).

These are all significant deals and shouldn’t be ignored. But on a macro level, global supply of solar PV panels, modules, cells, and wafers are expected to far outstrip demand in 2011. Forbes cites an analyst from Morgan Stanley who said in a research note to clients that global shipments should shrink 12% in 2011.  Add to that the analyst’s estimate that supply could reach 30,000 megawatts, nearly double expected demand of 15,500 megawatts. Prices, and margins, will be hit and hit hard.

Morgan Stanley isn’t alone. Investment bank Roth Capital Partners projects demand of 18,000 megawatts of global solar PV demand in 2011, although it sees supply capability of about 21,000 megawatts.  That’s not as much as Morgan Stanley, but will still affect margins. Average selling prices could fall as much as 30% according to Roth, though the bank believes a 15% drop is more realistic.

Chinese banks have agreed to lend more than $25 billion to the country’s solar makers, and the companies are expected to use at least part of the cash to increase capacity. Yingli Green Energy Holding Co. Ltd. (NYSE: YGE), LDK Solar Co. Ltd. (NYSE: LDK), Trina Solar Ltd. (NYSE: TSL), and Suntech have all received loans ranged from $4.4 billion to $8.9 billion.

It’s not like over-supply in the solar PV business is breaking news. The outlook for 2011, among more sober observers, has been lukewarm at best. But the combination of policy decisions to reduce incentives in Germany and Italy and the expected increase in manufacturing capacity can’t seem to overcome the near daily announcements of a new solar plant being built somewhere.

In 2010, some 15,000-17,000 megawatts of solar power are estimated to have been installed, and that pretty much soaked up capacity. Capacity additions even 6,000 megawatts represent a 40% increase in manufacturing capability while installation growth is estimated at no more than 20%. Prices have to fall, and with them revenue and profits.

The moral is earnings reports for the just-completed quarter are not necessarily good predictors of what’s happening in the solar PV market. Most companies will follow MEMC Electronic Materials Inc. (NYSE: WFR) which last week reported better than double fourth quarter revenue and positive earnings. MEMC even boosted its 2011 guidance, but the company has failed to meet EPS expectations, modest as they were, for four consecutive quarters.

With the exception of SunPower, the solar companies are trading down between -1% and -2% this morning. The Guggenheim Solar ETF (NYSE: TAN) is also down about -1%.

Paul Ausick

Canadian Imperial Bank of Commerce (NYSE: CM) Raised to Equal-Weight at Morgan Stanley.
Cooper Tire & Rubber Co. (NYSE: CTB) Raised to Buy at BofA/ML.
Edison International (NYSE: EIX) Cut to Neutral at Goldman Sachs.
Focus Media Holding Ltd. (NASDAQ: FMCN) Raised to Buy at Goldman Sachs.
Goodyear Tire & Rubber Co. (NYSE: GT) Raised to Buy at BofA/ML.
The Home Depot, Inc. (NYSE: HD) Raised to Outperform at FBR.
Janus Capital Group (NYSE: JNS) Raised to Overweight at Barclays.
Johnson & Johnson (NYSE: JNJ) Cut to Market Perform at Wells Fargo.
Legg Mason Inc. (NYSE: LM) Raised to Overweight at Barclays.
Lowe’s Companies Inc. (NYSE: LOW) Cut to Market Perform at FBR.
OpenTable, Inc. (NASDAQ: OPEN) Started as Perform at Oppenheimer.
Paychex Inc. (NASDAQ: PAYX) Cut to Market Perform at Wells Fargo.
Royal Bank of Canada (NYSE: RY) Cut to Underweight at Morgan Stanley.
Under Armour, Inc. (NYSE: UA) Cut to Neutral at Stern Agee.
Walgreen Co. (NYSE: WAG) Raised to Buy at UBS.

You can join our free daily email distribution list to hear more about dividend trends, analyst upgrades and downgrades, top day trader and active trader alerts, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

The pact will provide approximately 100 MW of electric power to California’s largest utility through its rooftop solar program. Today’s announcement covers 2.5 million square feet of roof space across five buildings, and is the first phase.  Edison will own and operate the system and all of the generated solar power will feed directly into the utility’s electrical system.  ProLogis will receive roof rental income, as well as construction management fees.

This is the second rooftop solar project between the two companies, and will bring ProLogis’ total partnership with SCE to 13.5 MW of solar energy after the installation is completed.

This is not the first round for ProLogis, as it has solar projects which are either installed or are under construction on 32 buildings throughout the U.S., France, Germany, Japan, and Spain which will be a combined 10.6 million square feet of roof space and a total energy equivalent of 24.6 megawatts.  As far as what lies ahead, ProLogis has more than 450 million square feet of global roof space which can accommodate solar installations.

ProLogis shares are up almost 10% at #12.20 on the news, although obviously much of the move is on “the risk trade being back” after the huge E.U. bailout this morning.  The old adage is “nothing is free,” or at least “if it sounds too good to be true, then it probably is.”  It turns out that the adage is not always true.  This may end up being free money, and the REIT status will mean that almost all of the income will go right into shareholder pockets via dividends.

JON C. OGG

We wanted to take a look at Select Sector SPDR Trust (NYSE: XLU), Southern Company (NYSE: SO), Dominion Resources, Inc. (NYSE: D), Duke Energy Corporation (NYSE: DUK), FPL Group, Inc. (NYSE: FPL), American Electric Power Company (NYSE: AEP), Entergy Corporation (NYSE: ETR), FirstEnergy Corporation (NYSE: FE), Edison International (NYSE: EIX), Progress Energy Inc. (NYSE: PGN), PP&L Corporation (NYSE: PPL), Xcel Energy Inc. (NYSE: XEL), DTE Energy Company (NYSE: DTE) and more.

There may actually be some time for them to shine in the near future. Despite the rally market of the last month, almost none of these stocks are within 5% of their 52-week highs.  We showed the dividend yields implied here, although as with all ‘yields’ there is often some distortion.  What we did not show was a P/E ratio because of the lagging effect of that, but we did show was the closing price for March 31 as the quarter closed and compared that to the 52-week trading range and compared it to the average consensus price target from Wall Street analysts per Thomson Reuters.

So why is this sector in the spotlight?  The dividend yields should be attractive enough.  Most are 4% and higher.  This offers defensive stock positioning, dividend yields, and the hope for some upside.  Of course, some are barren of a dividend due to issues and turnarounds. That keeps investors from having to go out to REITs and take on all the risks there associated with land values and trends.  Historically, utilities have been largely considered defensive stocks in hard times.  Morningstar noted in its quarterly wrap-up, “Utility stocks were hurt in the quarter by falling commodity and energy prices, bearish earnings outlooks as firms reported earnings, and a generally negative view of the future of electricity demand.”  The problem with that call is that energy demand is not dropping any longer and some larger companies are starting to increase their power usage again.

American Express Co. (NYSE: AXP) Started as Outperform at Wells Fargo.
Best Buy Co. (NYSE: BBY) Cut to Sell at Societe Generale.
Carnival Corp. (NYSE: CCL) Raised to Overweight at JPMorgan.
Charles Schwab (NASDAQ: SCHW) Raised to Buy at Deutsche Bank.
Chubb Corp. (NYSE: CB) Started as Outperform at Oppenheimer; Started as Buy at Deutsche Bank.
Edison International (NYSE: EIX) Cut to Neutral at Credit Suisse.
Franklin Resources (NYSE: BEN) Cut to Hold at Deutsche Bank.
Royal Caribbean Cruise (NYSE: RCL) Raised to Overweight at JPMorgan.
T. Rowe Price (NASDAQ: TROW) Raised to Buy at Deutsche Bank.
US Steel (NYSE: X) Raised to Buy at KeyBanc.

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JON C. OGG