In the firm’s equity income allocations, the firm is selling 100% of its allocation in American Electric Power Co. (NYSE: AEP) at $41.14 and is adding in Williams Companies Inc. (NYSE: WMB) at $28.22.

As far as growth and income, Argus is recommending to buy CSX Corp. (NYSE: CSX) at $23.32 and Monsanto Co. (NYSE: MON) at $79.00; and it is recommending that the model portfolio sell all of its positions in Occidental Petroleum Corp. (NYSE: OXY) at $97.17 and Weyerhaeuser Co. (NYSE: WY) at $19.18.

Finally, in mid-cap growth the firm’s model portfolio is buying VeriFone Systems Inc. (NYSE: PAY) at $37.12 and buying MDU Resources Group Inc. (NYSE: MDU) at $21.50.  It is selling 100% of its position in IntercontinentalExchange Inc. (NYSE: ICE) at $113.13.  Another selling stock, but only by 20% of its allocation is Hain Celestial Group Inc. (NASDAQ: HAIN).

Speaking of model portfolios, here were the 5 most undervalued DJIA stocks and the 5 least attractive DJIA stocks based upon consensus targets.  Here are the top 4 DJIA stock picks from Jim Cramer for 2012.

Also, we made a lot of changes this year to the 24/7 Wall St. 2012 Model Dividend Portfolio.

JON C. OGG

The unofficial closing bells put the DJIA down nearly 3 points to 12,415.70 (-0.02%), the NASDAQ rose more than 21 points (0.81%) to 2,669.86, and the S&P 500 rose 0.29% or nearly 4 points to 1,281.05.

There were several analyst upgrades and downgrades today, including Broadcom Corp. (NASDAQ: BRCM) maintained ‘buy’ with a $46 target price at Argus; Netflix Inc. (NASDAQ: NFLX) maintained ‘underperform’ and estimates cut at Needham; Nokia Corp. (NYSE: NOK) raised to ‘outperform’ at Credit Suisse; Google Inc. (NASDAQ: GOOG) cut to ‘hold’ at Benchmark; and VMWare Inc. (NYSE: VMW) started as ‘buy’ at Sterne Agee.

Earnings reports of note since markets closed yesterday include: Constellation Brands Inc. (NYSE: STZ) is down about -3.5% at $19.72; Monsanto Co. (NYSE: MON) is up more than 5.5% at $76.70; Worthington Industries Inc. (NYSE: WOR) is down -0.6% at $17.55; and Helen of Troy Ltd. (NASDAQ: HELE) is up more than 4% at $32.73.

Other standouts from today include the following stocks:

Dendreon Corp. (NASDAQ: DNDN) is up nearly 40% at $10.61. The biotech company reported a sales jump of 25% for its prostate cancer drug. The company is one of our top biotech picks for 2012.

Ancestry.com, Inc. (NASDAQ: ACOM) is up more than 21% at $27.69. The internet genealogy provider reported a 22% rise in subscribers and forecast sales growth for 2012 of more than 14%.

Zumiez Inc. (NASDAQ: ZUMZ) is up nearly 17% at $30.74 after posting a new 52-week high earlier of $30.94. The sports apparel company reported a 10% same-store sales gain and raised guidance this morning. See our coverage here.

Orchard Supply Hardware Stores (NYSE: OSH) is down nearly -25% at $16.70. The home improvement store held its IPO on Monday and today provided a weak outlook for 2012.

Barnes & Noble Inc. (NYSE: BKS) is down more than -17% at $11.25. The bookstore chain said today that it is considering spinning off its Nook e-reader unit as a strategic option. Our coverage is available here.

American Eagle Outfitters Inc. (NYSE: AEO) is down more than -10% at $13.61. The clothing retailer slashed its fourth-quarter profit guidance by nearly a quarter.

Stay tuned for Friday. Federal Reserve Governors Elizabeth Duke and Sarah Bloom Raskin are speaking, as are Boston Fed President Eric Rosengren and New York Fed President William Dudley. Here are the noteworthy events on the schedule (all times Eastern):

• 8:30 a.m. – Employment reports, including non-farm payrolls
• 3:00 p.m. – US Treasury STRIPS

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Paul Ausick

The unofficial closing bells put the DJIA up about 21 points to 12,418.57 (0.17%), the NASDAQ fell less than 1 point (-0.01%) to 2,648.36, and the S&P 500 rose 0.02% or less than 1 point to 1,277.31.

There were several analyst upgrades and downgrades today, including EMC Corp. (NYSE: EMC) added to ‘US Focus List’ at Credit Suisse; General Dynamics Corp. (NYSE: GD) raised to ‘overweight’ at JPMorgan; Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) reiterated ‘buy’ with $94 target price at Canaccord Genuity; Potash Corp. of Saskatchewan Inc. (NYSE: POT) started as ‘underperform’ at National Bank; and Tivo Inc. (NASDAQ: TIVO) raised to ‘overweight’ at Evercore Partners.

Earnings reports of note since markets closed yesterday include: Unifirst Corp. (NYSE: UNF) is up more than 3% at $59.83; and Progress Software Corp. (NASDAQ: PRGS) is down more than -11% at $17.55. Tomorrow sees earnings from Constellation Brands Inc. (NYSE: STZ), Monsanto Co. (NYSE: MON), and Family Dollar Stores Inc. (NYSE: FDO) among others.

Other standouts from today include the following stocks:

LCA-Vision Inc. (NASDAQ: LCAV) is up more than 40% at $4.33. The laser vision correction system provider said that it performed more than 14,000 procedures in the fourth quarter, up 30% year-over-year.

Rare Element Resources Ltd. (AMEX: REE) is up more than 27% at $4.53. The rare earths miner announced that its resource at the company’s Bear Lodge project is 38% higher than previously believed.

Netflix Inc. (NASDAQ: NFLX) is up nearly 11% at $80.02. The video distributor reported that it streamed more than 2 billion hours of video in the fourth quarter. More details on this story are available here.

Acme Packet Inc. (NASDAQ: APKT) is down more than -19% at $25.65, after posting a new 52-week low of $25.20 early this morning. The networking company warned on earnings last night. We have more coverage here.

Life Partners Holdings Inc. (NASDAQ: LPHI) is down more than -15% at $5.38. The life insurance company has been accused of accounting fraud by the US Securities and Exchange Commission.

Stay tuned for Thursday. Here are the noteworthy events on the schedule (all times Eastern):

• 7:30 a.m. – Challenger Gray & Christmas job-cut report
• 8:15 a.m. – ADP employment report
• 8:30 a.m. – Weekly initial unemployment benefits claims report
• 10:00 a.m. – ISM non-manufacturing index
• 10:30 a.m. – EIA weekly natural gas report
• 11:00 a.m. – EIA weekly petroleum status report
• 4:30 a.m. – Federal Reserve balance sheet and money supply reports

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Paul Ausick

According to the company’s CEO,

Isolated phosphate market spot prices have become disconnected with the underlying agricultural fundamentals. As dealers and distributors focus on the macroeconomic uncertainty and delay purchases for the North American Spring Season, near term supply of phosphate barges on the Mississippi River has exceeded near-term demand. The current spot prices in this market do not reflect our outlook for the business, nor do we think they are sustainable.

The company continues to believe that believe that demand for phosphates and potash will be strong in 2012, following this period of “near-term cautious sentiment.”

The projected cuts total about 10% of Mosaic’s quarterly production.

Paul Ausick

Fertilizer maker Potash Corp. of Saskatchewan, Inc. (NYSE: POT) reported third-quarter earnings this morning that were more than double earnings for the same period a year ago. But in this case, a hit may be as good as a miss. Analysts expected EPS of $0.94 on revenue of $2.17 billion. Potash Corp. delivered diluted EPS of $0.94 on revenue of $2.32 billion. Gross margin rose from 35% in the same period last year to 49% this year. The company also noted that its EPS outlook for the full fiscal year is $3.40-$3.80. The consensus estimate is $3.75. In other words, no upside surprises from Potash Corp.

At the other end of the food chain, food processor Bunge Ltd. (NYSE: BG) reported third-quarter adjusted EPS of $0.86 on revenue of $15.62 billion. The consensus estimates called for EPS of $1.62 on revenue of $14.32. Only Bunge’s fertilizer operations posted a quarterly gain over the same period last year, and that a scant $9 million. The company’s outlook did not include any specific forecasts for EPS or revenue, but Bunge does expect to fall short of its original estimate of sugar refining and sees continuing pressure on oilseed prices. The company expects its fertilizer business to improve, but that is historically its smallest revenue producer.

Ag company Archer Daniels Midland Co. (NYSE: ADM) reports earnings next Tuesday, and the consensus estimates are looking for EPS of $0.67 on $18.93 billion in revenue. The company posted EPS of $1.01 in the second quarter, and the estimate has fallen by 13% over the past three months.

Fertilizer makers Monsanto Co. (NYSE: MON) and Mosaic Co. (NYSE: MOS) recently reported earnings for the first quarter of their 2012 fiscal years, and the results were not particularly thrilling. Monsanto posted an EPS loss of -$0.22, though that was better than an expected loss of -$0.27. For the current quarter Monsanto is expected to post EPS of $0.12. Mosaic posted EPS of $1.17 in its quarter ended in August and analysts are expecting EPS of $1.39 for the current quarter. In its quarter ending in August 2010, Mosaic posted EPS of $1.85.

All the fertilizer makers expect to see a price hike for their products both in the current quarter and next year. The reasoning is that the global economic slowdown notwithstanding, people want and need to eat. Rising economic conditions in the developing world, especially in China and India, support food prices and because it is cheaper to increase yields by applying fertilizer than it is to bring new land into food production, the companies foresee continuing growth.

Potash Corp. noted in its earnings release that shipments of potash to China and India are set for the fourth quarter and the company expects volumes to increase and prices to rise beginning in the first quarter of 2012. Potash Corp. said that contract potash prices to India will rise by $60/metric ton beginning in January.

While the general trend of the news is positive, volatility in the food and fertilizer markets seems to have been discounted in the outlooks for the coming year. The other big problem is the unreliability of information from China regarding stockpiles and demand. One trader has said that 80% of the information out of China is misleading, and that finding the 10%-20% that is accurate and useful is more difficult than it should be. That means that counting on China for growth can be risky, at best.

Shares in Potash Corp. are trading up about 2.4% in the pre-market this morning, at $50.70, in a 52-week range of $39.54-$63.97. Bunge stock is trading up less than 1%, at $60.00, in a 52-week range of $54.03-$76.12. The Market Vectors Agribusiness ETF (NYSE: MOO) is up about 1.67%, at $50.55, in a 52-week range of $39.86-$57.93.

Paul Ausick

We had many key analyst upgrades and downgrades today, including calls in shares of Baidu, Inc. (NASDAQ: BIDU) and Monsanto Co. (NYSE: MON).  The retail sector did not follow the news,  due to some fears that the holiday season is not going to be as strong as many expected.  Speaking of analyst calls and projections, there are still some extremely lofty upside price targets out there in the automotive sector.

Here are today’s big post-earnings news reactions with prices during the last half-hour of trading: (only show late-day percent change and price): AT&T (NYSE: T) down about -0.1% at $28.97, Cirrus Logic, Inc. (NASDAQ: CRUS) down nearly -17% at $14.21; Polycom, Inc. (NASDAQ: PLCM) down -25%, at $16.46; Phillip Morris International, Inc. (NYSE: PM) up more than 4%, at $68.77; Nokia Corporation (NYSE: NOK) up more than 6%, at $6.50; and  Select Comfort Corporation (NASDAQ: SCSS) up more than 20%, at $19.38.

Several other standouts from today are as follows…

Riverbed Technology, Inc. (NASDAQ: RVBD jumped more than 9.5%, to $24.69, following a better than expected earnings report after markets closed last night.

Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) rose nearly 13%, to $11.56, after getting approval for wider use of its diabetes drug and posting a smaller than expected third-quarter loss.

Clearwire Corp. (NASDAQ: CLWR) shares are up nearly 13% as well, to $1.57, probably as a result of indications that its spectrum licenses could get some competitive bids.

Buffalo Wild Wings, Inc. (NASDAQ: BWLD) is up nearly 7%, to $62.06, after reporting a 33% rise in income for the third quarter.

After a busy week of economic data, there are no major market moving economic reports due Friday morning.  Look for Fed-head speeches on Friday from Kocherlakota, Fisher, and Yellen throughout the day.  Most importantly, watch for more news out of Europe on just how much the Europeans are going to throw into their European Financial Stability Fund (Europe’s mini-me version of the TARP).

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Baidu, Inc. (NASDAQ: BIDU) Cut to Neutral at Goldman Sachs.
Changyou.com Limited (NASDAQ: CYOU) Raised to Buy at Goldman Sachs.
Core Laboratories N.V. (NYSE: CLB) Cut to Market Perform at FBR.
CSX Corporation (NYSE: CSX) Cut to Market Perform at Wells Fargo.
eBay Inc. (NASDAQ: EBAY) Maintained long-term outperform and near-term hold at Zacks; reiterated Outperform at Credit Suisse.
Herbalife (HLF: NYSE) Reiterated Buy at Canaccord Genuity.
Macy’s Inc. (NYSE: M) Started as Overweight at JPMorgan.
Monsanto Co. (NYSE: MON) Started as Market Perform at Wells Fargo.
PVH Corp. (NYSE: PVH) named value stock of the day at Zacks.
Polycom, Inc. (NASDAQ: PLCM) Cut to Neutral at Piper Jaffray; Cut to Market Perform at William Blair.
Regency Centers Corporation (NYSE: REG) Raised to Outperform at Credit Suisse.
Western Digital Corporation (NYSE: WDC) Cut to Underweight at JPMorgan.
Western Union (NYSE: WU) Raised to Outperform as Bull of the Day at Zacks.
Wynn Resorts Ltd. (NASDAQ: WYNN) Reiterated Outperform at Credit Suisse.
Youku.com Inc. (NYSE: YOKU) Raised to Conviction Buy List at Goldman Sachs.

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American Capital Agency (NASDAQ: AGNC) Cut to Market Perform at JMP Securities.
Apple Inc. (NASDAQ: AAPL) Reiterated Outperform with $500 target at Credit Suisse.
Archer Daniels Midland Company (NYSE: ADM) Started as Hold at Argus.
Cal-Maine Foods, Inc. (NASDAQ: CALM) named value stock of the day at Zacks.
Caterpillar Inc. (NYSE: CAT) Raised to Buy at Goldman Sachs.
Dollar Tree, Inc. (NASDAQ: DLTR) Cut to Equal-Weight at Barclays.
Family Dollar Stores, Inc. (NYSE: FDO) Raised to Overweight at Barclays.
Hewlett-Packard Co. (NYSE: HPQ) Reiterated Buy with $40 target at Argus.
Kirkland’s, Inc. (NASDAQ: KIRK) Cut to Underperform as bear of the day at Zacks.
Lincoln National Corporation (NYSE: LNC) Added to the U.S. 1 List at BofA/ML.
Monsanto Company (NYSE: MON) Reiterated Outperform as Bull of the Day at Zacks.
Navistar International Corp. (NYSE: NAV) Cut to Sell at Goldman Sachs.
Tiffany & Co. (NYSE: TIF) Started as Buy at Stern Agee.
Veeco Instruments Inc. (NASDAQ: VECO) Cut to Sell at Canaccord Genuity.

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JON C. OGG

Copper prices peaked in February, about a month behind copper miners Freeport-McMoran Copper & Gold Co. (NYSE: FCX), Southern Copper Corp. (NYSE: SCCO) and a little earlier than BHP Billiton plc (NYSE: BHP) and Rio Tinto plc (NYSE: RIO). The decline in share prices was gradual from about April through July, but beginning in August shares turned more sharply down, as did the price of copper itself.

Corn prices hit a peak in June, and are still about 20% higher than they were in October 2010. None of the big ag stocks are near that high except fertilizer maker Monsanto Co. (NYSE: MON), up 31% in the past 12 months. Archer Daniels Midland Co. (NYSE: ADM) shares are off -23% in the past year, Bunge Ltd. shares are off about -3%, Potash Corp. of Saskatchewan shares are down about -11%, and Mosaic Co. is off nearly -18%. Ethanol producers Valero Energy Corp. (NYSE: VLO) is up about 2%, while Pacific Ethanol Inc. (NASDAQ: PEIX) is barely breathing, off -96%.

The decline in the copper price began when orders from China began to cool off as a result of the country’s efforts to slow down its GDP growth. By some reports the country has an over-supply of housing that tops 65 million units. If the number is even half that, demand for copper in China could fall dramatically. And it’s possible to argue that a housing glut in China drove the copper price to new heights because construction in the US and other developed countries has stalled.

But the current global economic malaise is not entirely attributable to China. Eurozone sovereign debt and questions about the zone’s banks have pushed markets down hard and could be just as responsible for the falling price of copper as softer demand from China. In other words, copper could be following, not leading, a macroeconomic decline.

The falling price of corn can be attributed to better crop forecasts and the recent ‘discovery’ of more than 200 million bushels in US stocks has put even more pressure on corn prices. Unlike copper, though, corn prices get some demand help from a large alternative market. If corn is a leading indicator, then the effect of ethanol production, which consumes about 40% of the US corn crop, distorts its influence.

Ethanol production is highly profitable at the current price of around $6/bushel. Corn prices would have to rise to unprecedented heights over $9.50/bushel before demand from ethanol makers would start to decline. Even without the $0.45/gallon federal subsidy, corn prices would need to top $8/bushel before they would pinch the ethanol makers.

Something similar to the ethanol prop to corn prices doesn’t exist for copper. Some 70% of copper demand comes from construction and electrical/electronic industries. Of the remaining 30%, about 12% comes from the transportation industry and 9% comes from makers of industrial machinery. None of those sectors is large enough to prop up copper prices as ethanol props up corn prices.

The iPath Dow Jones-UBS Copper Subindex Total Return ETF (NYSE: JJC) is down more than -1.5% in the first half hour of trading this morning at $39.46, barely above its 52-week low of $39.08. The 52-week high is $61.69. The First Trust ISE Global Copper Index Fund (NASDAQ: CU) is up about 2.25%, at $26.37, in a 52-week range of $23.60-$46.85.

Agricultural ETFs are up slightly this morning. The Teucrium Corn Fund (NYSE: CORN) is up about 0.5%, at $40.09, in a 52-week range of $31.37-$50.69. The PowerShares DB Agriculture Fund (NYSE: DBA) is up about 0.6%, at $29.90, in a 52-week range of $26.60-$35.58. The Market Vectors Agribusiness ETF (NYSE: MOO) is up about 0.9%, at $42.30, in a 52-week range of $39.86-$57.93.

Paul Ausick

Mosaic gives the first indication of overall strength among the other fertilizer makers. Potash Corp. of Saskatchewan, Inc. (NYSE: POT) is expected to post EPS of $0.93 for the quarter ending this month, more than double its EPS of $0.44 in the same period a year ago. Agrium Inc. (NYSE: AGU) is expected to show EPS of $1.85 in same period, up from EPS of $0.37 a year ago. Analysts expect CF Industries Holdings, Inc. (NYSE: CF) to post EPS of $4.56 in the September quarter, up from $1.10 a year ago. Only Monsanto Co. (NYSE: MON) is expected to post an EPS loss of -$0.27 for the current quarter, largely due to weakness in sales and margins of its Roundup herbicide.

The demand for fertilizer, particularly potash, reflects an effort among the world’s farmers to increase yields as crop prices remain relatively high. Expectations for crop plantings in the 2012-2013 crop year indicate that global wheat acreage could rise to about 563 million acres in 2012, up 4% from last year, while corn plantings could rise to 94.3 million acres world-wide.

But even if acres planted don’t increase much, farmers everywhere are looking to increase yields. China, for example, plants nearly as many acres of corn as the US, but yields are just half as large. If the country’s farmers could increase their yields, the amount of corn China must import to feed its people would fall.  The country has also restricted consumption of corn for industrial purposes like sweeteners and ethanol.

In what could be a boost to seed makers like Monsanto and Syngenta AG (NYSE: SYT), China is also considering allowing the import of genetically modified seed even as it tests a domestically developed strain of corn seed. The country does allow import of genetically modified strains of corn for consumption.

Farmers chasing yield improvements are expected to be the driving force behind fertilizer makers’ growth. Mosaic received an average of $446/metric ton of potash in its first quarter, up from $331 in the same period a year ago. The company guided potash prices for the second quarter at $440-$465/metric ton. For its phosphate products, Mosaic received $576/metric ton in the first quarter, compared with $431 in the same period a year ago. Phosphate prices for the second quarter were guided at $600-$625/metric ton.

While farm prices remain high, fertilizer makers can raise prices and still maintain volume. Mosaic guided shipment levels for potash at 1.7-2.1 million metric tons for the second quarter, compared with shipments of 1.8 million metric tons in the first quarter. Shipments of phosphates are expected to rise to 3.1-3.5 million metric tons in the second quarter, compared with 3.2 million metric tons shipped in the first quarter.

The fertilizer business is strong now and looks to remain that way for the coming year.  Market Vectors Agribusiness ETF (NYSE: MOO) is also up by more than 1% at $45.01 and its 52-week range is $43.00 to $57.93.

Paul Ausick