Analysts' Upgrades, Downgrades: VMWare

Principal Financial (PFG) upgraded at Merrill to Buy. Company can generate high-teens ROE in a normal environment, reducing the risk that it will have to raise a lot of capital.

Raymond James (RJF) downgraded at Wachovia to Underperform. Weak retail and capital markets should plague earnings in 2009. Company is also hurt by the current interest rate structure.

VMWare (VMW) downgraded at Merrill to Neutral. $31 price target. Valuation call, as the stock is up 62% since earnings.

Stock Comments/EPS Changes

Dean Foods (DF) numbers cut at Morgan Stanley. Shares now seen reaching $26. Estimates also lowered to match the company's new guidance. Equal-weight rating.

EOG Resources (EOG) price target raised at Goldman to $93 from $90 following strong Q3 earnings results. Maintained Buy rating.

Herbalife (HLF) numbers cut at Morgan Stanley. Target lowered to $52. Estimates also cut, given the company's new guidance. Overweight rating.

Philip Morris (PM) target trimmed at Goldman to $54 from $56 based on lower earnings expectations related to currency volatility. Fundamentals remain extremely strong. Maintained Buy rating.

Textron (TXT) price target lowered at Goldman to $21 from $23. Company lowered Cessna 2009 production expectations. Maintained Neutral rating.

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