Investing

24/7 Wall St. Top Analyst Upgrades & Downgrades of the Week (BAC, BRCD, DNDN, DG, LNKD, HK, POT, RSH, SNDK, SYMC, MCD, TEVA, TA, WMT, YHOO)

Each morning we cover numerous analyst upgrades, downgrades, and initiations from Wall Street research firms which we think will have an impact on stocks and sectors.  After each week we review those research calls and other research calls to see which ones really stood out or which ones had the most impact on each company and sector.  With a week of a 500 point drop on the DJIA in a day and almost 700 points down for the week, let’s just say that some of the calls can look a bit distorted.

The top analyst research calls of the week were as follows: Bank of America Corporation (NYSE: BAC); Brocade Communications Systems, Inc. (NASDAQ: BRCD); Dendreon Corporation (NASDAQ: DNDN); Dollar General Corporation (NYSE: DG); LinkedIn Corporation (NYSE: LNKD); Petrohawk Energy Corporation (NYSE: HK); Potash Corp. of Saskatchewan (NYSE: POT); RadioShack Corporation (NYSE: RSH); SanDisk Corporation (NASDAQ: SNDK); and Symantec Corporation (NASDAQ: SYMC).  We also highlighted some other key research calls which may have gotten lost in the market shuffle this week as follows: McDonald’s Corporation (NYSE: MCD); Teva Pharmaceutical Industries Limited (NASDAQ: TEVA); TravelCenters of America LLC (AMEX: TA); Wal-Mart Stores Inc. (NYSE: WMT); and Yahoo! Inc. (NASDAQ: YHOO).

Each call has been shown in the research summery along with a price target, and color or background data has been added if applicable.

The first measure is one we had already assumed was coming sooner or later.  The S&P downgrade of the United States to “AA+” from “AAA.”  Earlier this week we handicapped the other Triple-A nations and pointed to the other countries that would soon be at-risk as well.  Warren Buffett has chimed in noting that the impact should be limited.

Bank of America Corporation (NYSE: BAC) was an interesting downgrade on Friday, where Wells Fargo cut its rating to Cut to Market Perform from Outperform.  It just could not take the pain any longer.  As a reminder, our own theory is that one big bank upgrades or downgrades a rival bank they are really issuing the same call on their own bank.  S&P Equity Research also cut its rating on BoFA on Friday to Hold from “Strong Buy.”  Whoops! BofA was as high as $10.05 on Monday, but shares closed down at $8.17 on Friday.

Brocade Communications Systems, Inc. (NASDAQ: BRCD) tanked some 28% on Friday to hit a new 52-week low of $3.52 at the closing price but hitting $3.28 during the trading day.  Janney Capital threw in the towel and cut the rating to “Neutral” from “Buy.”  This is just one more bull losing faith and now the hope of a buyout cannot occur for quite some time.

Dendreon Corporation (NASDAQ: DNDN) was the unexpected implosion of the week.  Had it not been for a deadly stock market, this would have garnered far more media coverage as the biotech disappointment of the year.  The news caught us off guard and it caught almost all of the analyst community as you can see with this whole spread of analyst downgrades in unison.  By the way, some solid applause should be given to Credit Suisse since it has been very negative all along on this one.

Dollar General Corporation (NYSE: DG) has more than 30% upside if BMO is correct.  It started coverage of the king of dollar stores as Outperform with a $40.00 price target.  This is one of our ten stocks to own for the next decade, but we would note that the consensus target from Thomson Reuters is currently about $37.25 but the $40 target is still well short of the $49.00 ‘street high’ target out there.

LinkedIn Corporation (NYSE: LNKD) lost one more of its bullish cheerleaders.  Morgan Stanley cut its rating to “Equal Weight” from Overweight due to just how realistic a $9 billion valuation is whether it has grown 20% more in a short period of time or not.  This downgrade came after the online social networking site for business beat earnings and said sales had more than doubled.  Morgan Stanley was one of the book-runners of the LinkedIn IPO.

Petrohawk Energy Corporation (NYSE: HK) has lost one of its bullish firms after one massive rally.  Petrohawk is in the process of being acquired by BHP for about $12.1 billion, but some investors have said they think it is worth more.  Credit Suisse does not think so as it cut the rating to “Neutral” from “Outperform.”  In short, “Take your money and run” is what they are saying after nearly a 200% rise in the last year due to the buyout.

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