The unofficial closing bells put the DJIA up nearly 7 points to 12,890.61 (0.05%), the NASDAQ rose more than 11 points (0.39%) to 2,927.23, and the S&P 500 rose 0.15% or 2 points to 1,351.96.

There were several analyst upgrades and downgrades today, including A123 Systems, Inc. (NASDAQ: AONE) cut to ‘sell’ at Wunderlich; Expedia Inc. (NASDAQ: EXPE) cut to ‘hold’ at S&P Capital IQ; Research in Motion Ltd. (NASDAQ: RIMM) reiterated as ‘hold’ with $15 target price at Cannacord Genuity; Amgen Inc. (NASDAQ: AMGN) cut to ‘perform’ at Oppenheimer and named ‘Bull of the Day’ at Zacks; and 3M Co. (NYSE: MMM) cut to ‘hold’ at Deutsche Bank. Apple Inc. (NASDAQ: AAPL) got a lift from a target price increase to $665, which we cover here. We’ve also got a story on how Apple gets 80% of the operating profit among all the phone makers.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Cisco Systems Inc. (NASDAQ: CSCO) is down -2.1% at $20.00 (here’s our coverage); American Superconductor Corp. (NASDAQ: AMSC) is down -8.74% at $5.50; Bunge Ltd. (NYSE: BG) is up 5.9% at $63.25; Dunkin’ Brands Inc. (NASDAQ: DNKN) is down -2.35% at $28.33; Lorillard Inc. (NYSE: LO) is up 9.8% at $124.46 after posting a new 52-week high of $127.68 earlier today; Pepsico Inc. (NYSE: PEP) is down -3.6% at $64.37 (our coverage here); Philip Morris International Inc. (NYSE: PM) is up 2.8% at $80.08 after setting a new 52-week high of $80.99 earlier today; Sirius XM Radio Inc. (NASDAQ: SIRI) is nearly flat at $2.19 (additional coverage here); and Teradata Corp. (NYSE: TDC) is up 10% at $63.85 after posting a new 52-week high earlier today of $64.97.

Other standouts from today include the following stocks:

Imperial Sugar Co. (NASDAQ: IPSU) is up more than 79% at $6.02. The sugar refiner and marketer said it is nearing a sale of one of its divisions.

Trina Solar Ltd. (NYSE: TSL) is up 20% at $11.08. The solar panel maker is getting a big boost from a report that China will add about 3,000 megawatts of solar PV generation this year, although some analysts think the total will be double that. Other Chinese solar panel makers are also getting a nice bump from the news. We have another view of the sudden rise here.

Diamond Foods Inc. (NASDAQ: DMND) is down more than -36% at $23.36 after posting a new 52-week low of $21.44 earlier today. The snack food maker will re-state accounting and that jeopardizes the deal to purchase the Pringles brand from Proctor & Gamble (NYSE: PG). See our coverage here.

Groupon Inc. (NASDAQ: GRPN) is down more than -15% at $20.82. The Internet coupon company posted weak earnings last night. See our coverage here.

Taleo Corp. (NASDAQ: TLEO) is up more than 17% at $45.62 after posting a new 52-week high of $45.71. The maker of cloud-based software is being acquired by Oracle Corp. (NASDAQ: ORCL). More coverage here and here.

Ceasars Entertainment Corp. (NASDAQ: CZR) is down about -3.8% at $14.80. The share price nearly doubled at yesterday’s IPO, to a high of $17.90, but the stock is coming back to earth today.

Stay tuned for Friday. Fed Chairman Ben Bernanke and Cleveland Fed president Sandra Pianalto are speakingWe have noted the following events on the schedule (all times Eastern):

• 8:30 a.m. – International trade report
• 9:55 a.m. – Reuters/University of Michigan consumer sentiment report
• 2:00 p.m. – US Treasury budget report

Your email address

subscribe

terms and conditions

Paul Ausick

Amgen Inc. (NASDAQ: AMGN) Cut to Perform at Oppenheimer; named as Bull of the Day at Zacks.
AU Optronics Corporation (NYSE: AUO) targets raised by Nomura and also by Credit Suisse.
A123 Systems, Inc. (NASDAQ: AONE) Cut to Sell at Wunderlich.
Elan Corp. (NYSE: ELN) Cut to Neutral at Credit Suisse.
Expedia Inc. (NASDAQ: EXPE) Cut to Hold at S&P Capital IQ.
Ingersoll-Rand plc (NYSE: IR) Raised to Outperform at Wells Fargo.
3M Co. (NYSE: MMM) Cut to Hold at Deutsche Bank.
Montpelier Re Holdings (NYSE: MRH) named as Bear of the Day at Zacks.
NYSE Euronext (NYSE: NYX) Resumed as Hold at Deutsche Bank.
Post Holdings Inc. (NYSE: POST) Started as Overweight at Barclays.
Research In Motion Ltd. (NASDAQ: RIMM) Reiterated Hold with $15 target at Canaccord Genuity.
Sohu.com Inc. (NASDAQ: SOHU) Cut to Hold at Deutsche Bank.

See the new high $665 price target on Apple Inc. (NASDAQ: AAPL) from this morning.

If you enjoyed the top analyst calls, you can sign up in the box below to join our morning email list to receive news directly in your inbox each morning. We include major analyst upgrades and downgrades, IPO and M&A news, special situation developments, observations on Warren Buffett and key market gurus, as well as special exclusive feature stories.

Your email address

subscribe

terms and conditions

JON C. OGG

GE continues to improve its internal workings and continues to improve its customer credit metrics in the GE Capital operations faster than most expected.  The company’s dividend hike came sooner than expected and this conglomerate is returning to normal sooner than expected even if the total portfolio changes is going to look like a decline in revenues on the surface.  While United Tech might have been the cheapest conglomerate, it was still General Electric which we included in the 24/7 Wall St. 2012 Model Dividend Portfolio.

GE was also listed as one of Jim Cramer’s 4 Favorite DJIA Stocks For 2012.

After a 0.7% rise on Thursday to $19.15, GE shares are up 6.9% year to date.  What is more impressive is that after you adjust for the dividend payment the stock of the conglomerate is up a massive 21.5% from the end of November and shares are up a massive 31.5% if you were lucky enough to buy shares on the day after Thanksgiving and hold them.

The manner in which GE is acting is that it wants to go well back over $20.00.  That is what its chart action is indicating at any rate.  At some point, it will take more continued good news of some sort from the company to make that sustainable.

In case GE manages to disappoint the street, the 50-day moving average is $16.89 and the 200-day moving average is $17.32.  The first support level would come in around $18.00 if any serious disappointment comes up and then down in the $17.60 area if the news is somehow much worse than investors are expecting.  Shares are now back up at levels not seen since last July and the historic 1-year chart shows that all sorts of resistance will come back into play in the $20.10 to $20.30 areas.

Thomson Reuters has a consensus (mean) price target objective of $21.21.

JON C. OGG

Read Also: 5 Most Undervalued DJIA Stocks

Analysts according to Thomson Reuters have a consensus price target objective of $88.79 over the next year versus a current share price of $74.90. That gives an implied upside of about 18.5% and its 2.6% dividend yield is likely to be raised sometime around this coming summer if all goes well.

One key issue is that much is price-based because United Tech is also down from its 52-week high the most of the three DJIA conglomerates with a drop of more than 18% from its 52-week high.  The market cap of $68 billion keeps United from being in the mega-cap or super-cap group and not that much higher than the $58 billion worth of 3M and only one-third of GE’s market cap.

There is a wild card here, a very big wild card… The Goodrich Corporation (NYSE: GR) acquisition which has been a huge overhang. That is the trick, and a clean deal will allow it to soar but a troubled deal could act as as a continued thorn in its side.

Read Also: DJIA Stocks Could Rise 12% (or 15%) In 2012

With a 52-week trading range of $66.87 to $91.83, United Tech does not even to reach a 52-week high to reach the consensus analyst price target.

Your email address

subscribe

terms and conditions

JON C. OGG

Boeing Co. (NYSE: BA) offered a surprise dividend hike that we would have expected perhaps next year, but it came anyhow. General Electric Co. (NYSE: GE) was one we have been calling on for a higher dividend down the pipe and it jumped in far sooner than expected. Those that hiked their dividends exactly as we expected are the Walt Disney Company (NYSE: DIS) with a much higher jump than the market was expecting, followed by AT&T Inc. (NYSE: T) and Pfizer Inc. (NYSE: PFE).

Those from whichwe are still looking for dividend hikes after the first of the year and just beyond the first quarter of 2012: Cisco Systems Inc. (NASDAQ: CSCO), the Coca-Cola Company (NYSE: KO), Exxon Mobil Corporation (NYSE: XOM), International Business Machines Corporation (NYSE: IBM), Johnson & Johnson (NYSE: JNJ), JPMorgan Chase & Co. (NYSE: JPM), 3M Company (NYSE: MMM), and Wal-Mart Stores Inc. (NYSE: WMT).

For those investors who love dividends, we would focus also in 2012 on some of the key ETFs, like the iShares Dow Jones Select Dividend Index (NYSE: DVY), Vanguard Dividend Appreciation ETF (NYSE: VIG), PowerShares Dividend Achievers (NYSE: PFM) and the iShares High Dividend Equity (NYSE: HDV) ETF products.

We have broken out some summaries of each DJIA component from which we still expect to see dividend hikes from soon.

Cisco Systems Inc. (NASDAQ: CSCO) has recently kept is low dividend static, and we would look for a 2012 announcement of a higher payout. It could boost the payout, but it needs its restructuring a bit further in the rear-view mirror to avoid bad PR. Look for Cisco to boost its payout in 2012 for its March or July payment. Even with its silly share buybacks, Cisco’s payout ratio is only about 14% of its expected 2012 earnings and the company has a mountain of cash.

The full report had more detailed data on most of these DJIA components, but these are some of the DJIA stocks we expect to hear from with a dividend hike in the coming weeks or early in 2012: AT&T Inc. (NYSE: T), Cisco Systems Inc. (NASDAQ: CSCO), The Coca-Cola Company (NYSE: KO), Exxon Mobil Corporation (NYSE: XOM), International Business Machines Corporation (NYSE: IBM), Johnson & Johnson (NYSE: JNJ), J.P. Morgan Chase & Co. (NYSE: JPM), 3M Company (NYSE: MMM), Pfizer Inc. (NYSE: PFE) and Wal-Mart Stores Inc. (NYSE: WMT).

Some of these are also weighted in key dividend ETFs like the iShares Dow Jones Select Dividend Index (NYSE: DVY), Vanguard Dividend Appreciation ETF (NYSE: VIG), PowerShares Dividend Achievers (NYSE: PFM) and the iShares High Dividend Equity (NYSE: HDV) ETF products.

We have broken out some summaries of each in here, although more detailed data on each may be found in the larger stock-by-stock review.

AT&T Inc. (NYSE: T) has some problems now that it has the multibillion dollar huge break-up fee as a designated charge. This could interrupt its dividend hike history, but Verizon Communications Inc. (NYSE: VZ) has a higher dividend payout ratio and it recently continued its practice of raising the payouts.

Cisco Systems Inc. (NASDAQ: CSCO) has already hinted at higher payouts and we would look for a 21012 announcement of a higher payout after its recent restructuring is farther behind it. Look for Cisco to boost its payout in 2012 for its March or July payment after its layoffs and restructuring are further behind it. Even with its silly share buybacks, Cisco’s payout ratio is only about 14% of its expected 2012 earnings and the company has a mountain of cash.

If you add up the past 12 SPDR Dow Jones Industrial Average (NYSE: DIA) dividend payments, the DJIA yield has been almost 2.5% over the last year. The good news is that the yield is already higher if you include the hikes that are likely to be announced. The price of the DJIA today should offer what will be closer to a 3% dividend yield in 2012.

The list of the 30 DJIA components is very long, but we have reviewed each and all of the following: Alcoa (NYSE: AA), American Express (NYSE: AXP), AT&T (NYSE: T), Bank of America (NYSE: BAC), Boeing (NYSE: BA), Caterpillar (NYSE: CAT), Chevron (NYSE: CVX), Cisco Systems (NASDAQ: CSCO), Coca-Cola (NYSE: KO), DuPont (NYSE: DD), Exxon Mobil (NYSE: XOM), General Electric (NYSE: GE), Home Depot (NYSE: HD), Hewlett-Packard (NYSE: HPQ), International Business Machines (NYSE: IBM), Intel (NASDAQ: INTC), Johnson & Johnson (NYSE: JNJ), JPMorgan Chase (NYSE: JPM), Kraft Foods (NYSE: KFT), McDonald’s (NYSE: MCD), 3M (NYSE: MMM), Merck & Company (NYSE: MRK), Microsoft (NASDAQ: MSFT), Pfizer (NYSE: PFE), Procter & Gamble (NYSE: PG), Travelers Companies (NYSE: TRV), United Technologies (NYSE: UTX), Verizon Communications (NYSE: VZ), Walmart Stores (NYSE: WMT) and finally Walt Disney (NYSE: DIS).

We have broken out each DJIA component to review the history and expected dividend action individually. While this is a no short read, dividend and income investors better pay close attention here. Value investors should pay attention as well. It is these DJIA components that are often considered as the prize of the sector and many peers are facing the same trends today and tomorrow. Our review focuses on when the last hikes have been seen, when the next dividend hike will come, and what the price and implied upside to the Thomson Reuters consensus price target offers. We also even have shown an expected income payout ratio on each if applicable to further show which companies can boost their payouts ahead.

Alcoa is still hanging its hat on the notion that the aluminum market will double by 2020, so we have to at some point expect the DJIA component to boost its dividends again in the years ahead. Still, the company is trying to accumulate more liquidity and the current climate is a choppy one for metals players. The dividend has been stuck at $0.03 since the first of 2009 and it was $0.17 per quarter before then. Any hikes might only be nominal until the business climate becomes a bit more steady and predictable. The 1.1% is very unimpressive for a DJIA component and we have no great dividend ambitions in the near-term for Alcoa, even if only 10% to 15% of expected 2012 income is slated for payouts. At $10.35, the consensus price target of about $13.25 is well under the 52-week high of $18.47.

American Express has had its dividend steady at $0.18 per quarter since its January 2008 payment and the current yield is only 1.4%. The company’s credit metrics keep improving and its payout is not quite 19% of expected earnings next year. Still, this is a financial stock and it is hard to a financial stock to boost dividends right now. It has no branch bank operations but the climate remains tenuous. At $49.70, the consensus price target is around $55.75 if you trust price targets on financial firms.

AT&T has had four quarters in a row of $0.43 and it has a history of raising its dividend each year. The question that hangs over it is the regulatory block over the T-Mobile buyout and the huge penalty that AT&T will ultimately have to pay out of it cannot clear regulatory hurdles. This is one of the dividend stars with a 5.8% yield but it also pays out more than 70% of its expected income. Another hike is possible, but our take is that the dividend yields are now so high that telecom giants will only ratchet them up slightly. At $29.20, the consensus price target is $31.90.

Is the world suddenly fixed? No. Are there still problems? Very much so. Will unemployment and housing suddenly recover? No. Still, the current barometer is showing that a recession is not yet likely going to come to the United States.  We have broken down ten key factors that signal how we may have luckily avoided the next recession: GDP, stocks, corporate earnings and dividends, interest rates, commodities and inflation, consumer spending, China and India, Europe, economist predictions, and the election cycle.

GDP, Gross Domestic Product

The U.S. Gross Domestic Product was far from any great or massive growth.  Regardless of what anyone says about GDP, this is the true barometer for whether or not we are in or entering into a recession.  For the third quarter, that preliminary reading was +2.5% and even the price component via the PCE Price Index was +2.4%.  Celebrating 2.5% growth might be a bit like taking a teenager to celebrate a birthday with any gift they want, in the dollar store.  Still, this is not anywhere close to a recession.  It is up from the readings of +1.3% GDP in the second quarter and versus +0.4% in the first quarter.  The caveat: anything under 3% GDP growth will not really lend to a great recovery and it is certainly not going to act to help housing prices nor the constantly weak jobs market.

Stocks

October of 2011 is turning out to be a phenomenal month.  This may be the best in a generation.  Not only did the DJIA get back above 12,000 after the E.U. stabilization and Greek debt haircut but this is up from the low of just under 10,400 for better than a 16% gain from the low.  This also happened during earnings season and we have witnessed the CBOE Volatility Index (The fear index) drop from a peak of above 45 down to almost 25, showing that the fear is drying up.  And the best news is that Apple Inc. (NASDAQ: AAPL) was only up about 5% so the market itself broadly outperformed Wall Street’s favorite darling.  You cannot have an infrastructure recovery without Caterpillar Inc. (NYSE: CAT) and its stock has risen a whopping 37% from the first day of October.  The two DJIA banks of J.P. Morgan Chase & Co. (NYSE: JPM) and Bank of America Corporation (NYSE: BAC) are both up just over 30% each from the first day of October.  Even a bear market bounce would not be this big if a recession was imminent.  The caveat: even a remedial chartist and a cocktail napkin chartist can recognize that stocks over the last three weeks have moved from very oversold to extremely overbought.

Europe and Asia led us lower, as did our credit debacle, and now it is the Europeans leading us higher.  This week is another turning point as well in that we have indications that China and India are not going to continue putting on the brakes to fight inflation.

What is interesting is that many are still skeptical that the European situation is resolved.  $1.4 trillion could buy Greece several times over, but what about Italy?  The new underlying talk is that Italian debt is going to be the next crunch that gets far worse than what we saw in recent weeks.  Spain, Portugal, and Ireland remain issues as well.  The DJIA winners so far are as follows:

Alcoa Inc. (NYSE: AA): $11.02, up $0.66 or 6.3%
 
Caterpillar, Inc. (NYSE: CAT): $95.58, up $4.01 or 4.38%

DuPont, or E.I. du Pont de Nemours and Company (NYSE: DD): $48.08, up $1.98 or 4.30%

General Electric Co. (NYSE: GE): $16.89, up $0.54 or 3.30%

Hewlett-Packard Company (NYSE: HPQ): $26.92, up $1.17 or 4.52%

J.P. Morgan Chase & Co. (NYSE: JPM) $36.12, up $1.94 or 5.68%

3M Co. (NYSE: MMM) $79.69, up $2.68 or 3.47%

Will DJIA 12,000 hold up?  For now, the trade remains: RISK ON!

JON C. OGG

Markets opened higher this morning on renewed hope for a deal on Europe’s debt debacle. At a meeting of EU leaders, the group approved a 9% capital buffer to go into effect by June 2012. That’s a start, but hardly the end of the long-running disagreement on how the continent should deal with its banking problems. Stocks got a boost from solid earnings from Boeing Co. (NYSE: BA) and Corning Inc. (NYSE: GLW). Oil prices have dropped more than $2.50/barrel following the weekly EIA report that US crude inventories increased by 4.7 million barrels. New home sales were also up for the first time in five months, following price cuts averaging 3.1%.

The unofficial closing bells put the DJIA up nearly more than 162 points to 11,869.04 (1.39%), the NASDAQ rose more than 12 points (0.46%) to 2.650.67, and the S&P 500 rose 1.05% or nearly 13 points to 1,241.97.

There were several analyst upgrades and downgrades today, including target price and estimate cuts on Amazon.com (NASDAQ: AMZN) at BofA/ML, but the firm maintained its ‘Buy’ rating on the stock. Bed Bath & Beyond Inc. (NASDAQ: BBBY) was maintained at ‘buy’ with a raised target price of $70 at Argus; First Solar Inc. (NASDAQ: FSLR) was cut to ‘hold’ at both Kaufman and Jefferies, and cut to ‘sell’ at S&P Capital IQ; 3M Co. (NYSE: MMM) was lowered to ‘market perform’ at William Blair; and The New York Times Co. (NYSE: NYT) was cut to ‘neutral’ by Citigroup.

Here are today’s big post-earnings news reactions with prices during the last half-hour of trading: Boeing is up more than 5% at $66.91; Corning is up 3.6% at $14.22; American Electric Power Co. Inc. (NYSE: AEP) is up 0.67%, at $38.91; ConocoPhillips Corp. (NYSE: COP) is up nearly 2%, at $72.03; Exelon Corp. (NYSE: EXC) is up 1%, at $42.75; and Complete Production Services, Inc. (NYSE: CPX) is up slightly, at $31.06, after trading lower for most of the day.

Several other standouts from today are as follows…

Cheniere Energy, Inc. (AMEX: LNG) is up about 70%, to $10.41. The company signed a 20-year agreement with BG Group plc to sell the British company 3.5 million metric tons of liquefied natural gas annually. The deal is worth about $8 billion, and deliveries are scheduled to begin in 2015.

First Financial Holdings, Inc. (NASDAQ: FFCH) is up more than 24%, at $6.76. The company has sold $198 million of some performing loans and other classified assets.

Rentech, Inc. (AMEX: RTK) is up more than 25%, to $1.51. The company successfully launched an IPO today of Rentech Nitrogen Partners, L.P. (NYSE: RNF) at an offering price of $15-$19/share. RTK owns about 61% of RNF and all of the general partner interests in the new company.

Human Genome Sciences, Inc. (NASDAQ: HGSI) is down about -21%, at $10.05, after posting anew 52-week low of $9.68 earlier in the day. The company reported weak earnings today, and its lupus drug failed to meet already low sales expectations.

DeVry Inc. (NYSE: DV) is down-17%, at $38.36. The company’s earnings failed to meet analysts’ estimates and enrollment also declined in its undergraduate degree programs.

Radioshack Corp. (NYSE: RSH) is down nearly -12%, at $11.80. The company missed earnings expectations as it transitions from being a T-Mobile reseller to a Verizon Wireless reseller.

Stay tuned for Thursday.  We have noted the following events (all times Eastern):

8:30 a.m. – Third quarter GDP report
8:30 a.m. – Unemployment claims
10:00 a.m. – Pending home sales from National Association of Realtors
10:30 a.m. – EIA weekly natural gas report
1:00 p.m. – Seven-year US Treasury note auction
4:30 p.m. – Federal Reserve balance sheet released

Your email address

subscribe

terms and conditions