TheStreet Notes: A Daily Briefing of Wall Street Research and Analyst Actions

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Change In Ratings | Stock Comments / EPS Changes | Strategy Calls / Market Calls | Economics | Meetings | View Archived StreetNotes

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Archer-Daniels-Midland Co (ADM / NYSE)
Deutsche Banc Alex Brown
Initiating coverage with a Market Perform rating and $16 price target.

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Automatic Data Processing (ADP / NYSE)
JP Morgan Chase & Co.
Initiating with long term buy, $64 Price Target. Stock has been outperforming the market, but we expect better buying opportunities to emerge. We see continued pressure on fundamentals as unemployment should rise and interest rates should fall more.

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Allergan (AGN / NYSE)
Weisel Partners
Initiate with Buy & $98 target; Diversified pharma company targeting ophthalmology & dermatology mkts enjoys promising R&D pipeline & visible growth, in our view

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Alberta Energy Company (AOG / NYSE)
JP Morgan Chase & Co.
Downgrading from Buy to LTB because we see additional 20%-30% downside risk if increasingly likely lower crude oil price comes to bear. We would step to sidelines for now, likely to be good buying opportunities ahead.

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Brocade Communications (BRCD / Nasdaq)
Lehman Bros
Initiating coverage with a Market Perform rating. We believe the shares are pricing in unrealistic long-term expectations.

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Cumulus Media (CMLS / Nasdaq)
Deutsche Banc Alex Brown
Upgrading from Market Perform to Strong Buy, with a $17 price target. The company is making two large acquistions, which will reduce the its debt leverage and improve its competitive position.

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Connetics Corporation (CNCT / Nasdaq)
Weisel Partners
Initiate with Buy & $16 target; Dermatology-focused product line & pipeline promise rapid growth & high visibility, in our view.

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Covance (CVD / NYSE)
SG Cowen
Initiating coverage with a Strong Buy rating and $27 price target.

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Dover Corporation (DOV / NYSE)
JP Morgan Chase & Co.
Downgrading from Buy to long term buy on valuation and continued lack of visibility in tech segment after investor meeting yesterday. Believe market already discounting and see little upside to $40 Price Target until market sees rebound in tech spending.

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EMC Corporation (EMC / NYSE)
Lehman Bros
Initiating coverage with a Market Perform rating.

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Corning Incorporated (GLW / NYSE)
Weisel Partners
Initiate with market perform; Believe core businesses attractivelong-term but we are cautious due to near-term weakness in telecom environment.

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ITXC Corp. (ITXC / Nasdaq)
Lehman Bros
Initiating coverage with a Market Perform rating. The company has a strong balance sheet, but near-term upside remains limited.

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Knight-Ridder (KRI / NYSE)
JP Morgan Chase & Co.
Downgrading from Buy to long term buy due to valuation and we're more cautious on economic outlook in 02. Lowering Q4E EPS from $0.98 to $0.89, 01E from $2.89 to $2.80 (inline with guidance), 02E from $3.15 to $3.00. Lowering Price Target from $65 to $64, upside is not as attractive.

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St. Mary Land & Explorat. (MARY / Nasdaq)
JP Morgan Chase & Co.
Downgrading from Buy to LTB because we see additional 20%-30% downside risk if increasingly likely lower crude oil price comes to bear. We would step to sidelines for now, likely to be good buying opportunities ahead.

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McData Corporation (MCDTA / Nasdaq)
Lehman Bros
Initiating coverage with a Market Perform rating.

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Nuevo Energy Company (NEV / NYSE)
JP Morgan Chase & Co.
Downgrading from Buy to LTB because we see additional 20%-30% downside risk if increasingly likely lower crude oil price comes to bear. We would step to sidelines for now, likely to be good buying opportunities ahead.

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Network Appliance (NTAP / Nasdaq)
Lehman Bros
Initiating coverage with a Market Perform rating.

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Principal Financial Group(PFG / Nasdaq)
Merrill Lynch
Initiating coverage with a Buy rating and $32 price target. The shares look very attractive at 1.3 times book value.

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Principal Financial(PFG / Nasdaq)
Warburg Dillon Read
Initiating coverage with a Buy rating and $27 price target.

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Proxim (PROX / Nasdaq)
Piper Jaffray
Upgrading from Neutral to Buy; Initial Successes With 802.11a, Harmony, And HRF 2.0 Products Should Provide Momentum Into 2002.

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Quintiles Transnational (QTRN / Nasdaq)
SG Cowen
Initiating coverage with a Buy rating and $20 price target.

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SAP AG (SAP / NYSE)
Prudential Securities
initiating coverage with a BUY rating and a 12-month price target of $37. The company's new technology platform together with its vertical industry expertise, large installed base, and improved execution create a competitive advantage that will help the company build on its dominant position in the applications market, and gain market share in both CRM and SCM.

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SunGard Data Systems (SDS / NYSE)
Credit Suisse First Boston
Downgrading from Buy to Hold.

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Silicon Laboratories (SLAB / Nasdaq)
Weisel Partners
Initiate with Buy & $40 target; Attractive growth opportunities in wireless, wireline & optical networking

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Storage USA (SUS / NYSE)
Smith Barney Shearson
Downgrading to Neutral from Outperform. Raised rating in Sept. based on merger proposal from Security Capital Group. Stock now trading in excess of $42 buyout price. Little upside left. Raising target $1 to $42.

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Tyson Foods (TSN / NYSE)
Merrill Lynch
Raising our near-term rating from Neutral to Accumulate, based on valuation. Now that the IBP deal has closed, the company will be able to move along with its strategy.

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TXU Corporation (TXU / NYSE)
Bank of America Montgomery
Downgrading from Strong Buy to Buy.

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VeriSign (VRSN / Nasdaq)
Piper Jaffray
Lowering Rating To Buy From Strong Buy To Reflect Increased Intermediate Term Risk. Long Term Business Outlook Unchanged; However Decline In .com/.net/.org Zone Files Points To Potential For Change In Market; Current Quarter On Track;

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W.P. Stewart & Co. (WPL / NYSE)
Smith Barney Shearson
Downgrading to Outperform from Buy based on valuation. Fundamentals strengthening, but still risks of single product, slow organic growth, tax rate. Maintain estimates and $27 price target.

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Weingarten Realty Invstrs (WRI / NYSE)
Smith Barney Shearson
Downgrade to Neutral from Outperform based on valuation. Lowering target to $51 from $52.

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Analog Devices (ADI / NYSE)
Merrill Lynch
We believe the company will report in-line earnings tomorrow. ADI business appears to have bottomed, and we'd be buying for the eventual recovery.

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ArvinMeritor (ARM / NYSE)
Morgan Stanley Co.
Raising 2002 estimate to $1.60 per share. Maintain Neutral rating.

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American Express Company (AXP / NYSE)
Sanford Bernstein
Maintain 2002 EPS Estimate At $2.07. The fall in 2002 consensus EPS estimates for AXP to $1.94 is an over-reaction to the downturn in travel volumes in September and the effect of the crash of flight 587 in aborting a nascent recovery. We maintain our EPS target for 2002 at $2.07 based on 6% growth in net incomeat TRS.

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Biomet (BMET / Nasdaq)
Dain Rauscher
Recent weakness unwarranted; Biomet not implicated in Minnesotapatient deaths; Strong macros give us confidence in Biomet's November quarter

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BorgWarner (BWA / NYSE)
Morgan Stanley Co.
Raising 2002 estimate to $4.20 per share. Maintain Outperform rating.

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CSG Systems International (CSGS / Nasdaq)
Deutsche Banc Alex Brown
Lowering estimates, following the company's analyst meeting. We now expect CSGS to earn $2 per share in fiscal 2002.

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CSG Systems International (CSGS / Nasdaq)
Robertson Stephens
Lowered guidance at analyst day. Reducing 2002 EPS to $1.82, down from $1.93. Reiterate Market Perform and $30 target.

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CSG Systems International (CSGS / Nasdaq)
Prudential Securities
Analyst day, '02 more back-ended loaded than expected; lowering eps, reit hold.

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ChevronTexaco(CVX / NYSE)
Bear Stearns
Maintain Buy Rating ? 12-Month Target Price $105. Hosted first analyst meeting for the newly merged company. Cost savings as a result of the merger are expected to total $1.8 billion, up $600 million from the original target. Oil and Gas Production Growth Is Projected at 2.5%?3.0% Annually

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ChevronTexaco(CVX / NYSE)
Smith Barney Shearson
First analyst meeting. Synergy target raised by 50% to $1.8B, from $1.2B, to be achieved in 18 months. This is broadly consistent with our prior expectations. Reiterate Buy rating and $93 target.

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ChevronTexaco(CVX / NYSE)
Warburg Dillon Read
Lowering 2002 estimate to $4.72 per share, as the company reduced production targets. Maintain Hold rating.

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Dana Corporation (DCN / NYSE)
Morgan Stanley Co.
Raising 2002 EPS estimate to $0.25, and maintaining our Neutral rating.

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Delphi Automotive Systems (DPH / NYSE)
Morgan Stanley Co.
Lowering fiscal 2002 estimate to $0.50 per share. Maintain Strong Buy rating.

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Edison International (EIX / NYSE)
Lehman Bros
Reducing estimates to reflect lower guidance. 2002 will be a rebuilding year, and we now expect the company to earn $1.60 per share.

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Edison International (EIX / NYSE)
Goldman Sachs
Lowering 2002 EPS to $1.55 from 1.70. 11/19 management guided 2001 and 2002 EPS of $1.27-$1.30 and $1.50-$1.60, respectively. Supports current price, with upside potential as the company pays creditors, works through its credit crisis, and establishes a clear path to higher 2003 earnings.

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Genuine Parts Company (GPC / NYSE)
Morgan Stanley Co.
Raising our 2002 estimate to $2.20 per share. Maintain Neutral rating.

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Goodyear Tire & Rubber (GT / NYSE)
Morgan Stanley Co.
Raising 2002 estimate to $0.80 per share. Maintain Neutral rating.

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Harrah's Entertainment (HET / NYSE)
Lehman Bros
Raising fiscal 2002 estimate to $2.08 per share, as the company's strong positioning will carry it through these difficult times. Reiterate Strong Buy rating.

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Jabil Circuit (JBL / NYSE)
Robertson Stephens
Lowering 2002 cash EPS to 58c from 70c and target to $30 from $38. Retaining Buy rating. Would wait until 1Q02 EPS release (12/20/01) before adding new monies given management guidance of $0.75-0.80 vs. our revised $0.55-0.65 estimate and consensus of $0.70 (range $0.55-0.80).

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Johnson Controls (JCI / NYSE)
Morgan Stanley Co.
Cutting 2002 EPS estimate to $5.40. Maintain Neutral rating.

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Longs Drug Stores Corp. (LDG / NYSE)
Lehman Bros
Lowering EPS estimates again, as front-end sales continue to be weak. We now believe the company will earn $1.23 this year and $1.30 in fiscal 2003.

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Lear Corporation (LEA / NYSE)
Morgan Stanley Co.
Raising fiscal 2002 estimate to $3.30 per share. Maintain Strong Buy rating.

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Lowe's Companies (LOW / NYSE)
Bear Stearns
Maintain Attractive rating. LOW should participate in any rally triggered by favorable economic news and/or shifts in Federal Reserve monetary policy. The company is focused on improving sales and margins through new merchandising and pricing strategies and can gain market share as it continues to enter larger metro-markets, especially in the Northeast.

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Lowe's Companies (LOW / NYSE)
Sanford Bernstein
Strong Third Quarter, Positive Outlook & Superior Performance to HD. Kicked off its annual analyst/investor conference on a positive note. We are raising our FY2001 EPS estimate to $1.26 from $1.24. For FY2002, we are raising our EPS estimates to $1.55 from $1.50. Fair value calculation increases to $44 from $39.

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Motorola (MOT / NYSE)
ABN Amro
We maintain HOLD rating and $15-$16 price target after MOTindicated that the mobile handset market in 2002 would increase by 15% in units and 0% in value. We believe that MOT's comments about pricing erosion are more bearish than current market expectations for 2002.

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Nokia Corporation (NOK / NYSE)
SG Cowen
Analyst Day Preview: long term improving, but near term challenges remain.

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New York Times Co. (NYT / NYSE)
JP Morgan Chase & Co.
Lowering revenue forecast, but project better cost performance. Lowering Q4E EPS from $0.65 to $0.62, 02E from $1.97 to $1.99, raising Price Target from $45 to $47. Valuation looks high but believe this is a good company.

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Pharmacia Corporation (PHA / NYSE)
Morgan Stanley Co.
Raising price target to $55 per share, on full FDA approval for Bextra.

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Pharmacia Corporation (PHA / NYSE)
Warburg Dillon Read
Raising price target to $54 per share, because of surprise early approval for Bextra.

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Phillips Petroleum Co. (P / NYSE)
Bear Stearns
P plans To acquire Conoco in an all stock transaction. The Deal Is Expected To Close In Second-Half 2002. We estimate the deal to be accretive to Phillips' earnings by 3%, or $0.14 per share. Maintain Neutral Rating; Estimated Trading Range: $44?$62

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Quest Software (QSFT / Nasdaq)
Dain Rauscher
Quarter appears to be tracking well thus far, good upside for 2002. Economic risk still exists

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Rational Software Corp. (RATL / Nasdaq)
Dain Rauscher
Checks on Rational's quarter are positive. We are raising our price target to $29 per share.

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SunGard Data Systems (SDS / NYSE)
Morgan Stanley Co.
Raising price target to $32 per share, on the successful acquisition of CDO's disaster recovery business. Reiterate Outperform rating.

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Staples (SPLS / Nasdaq)
NEWS
reported in-line third quarter earnings of 20c/share, above the 18c/share in the same period last year. Sales were $2.83 billion for the third quarter, representing a one percent increase versus the $2.80 billion reported for the same period last year.

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Valspar Corporation (VAL / NYSE)
ABN Amro
reiterate our ADD rating and are raising our price target from $38 to $43 based on valuation. However, in our view, VAL's current price, fully discounts the cost savings from the Lilly acquisition and optimism about the US recovery gaining traction by mid-2002.

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Visteon Corporation (VC / NYSE)
Morgan Stanley Co.
Raising 2002 estimate to $0.75 per share.

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Viacom (VIA.B / NYSE)
Weisel Partners
Despite a challenging advertising environment, we believe Viacom's television properties, notably CBS, MTV and VHI are "bucking the trend" with scatter CPMs running slightly ahead of upfront pricing. We believe CBS has sold 98% of its December quarter inventory, valuation compelling.

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Xerox Corporation (XRX / NYSE)
Morgan Stanley Co.
We remain cautious about the company's prospects, and are maintaining our estimates below consensus. Maintain Neutral rating.

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Morgan Stanley Co. (Railroads/Shipping)
After speaking with industry players, we see no signs of near-term recovery.

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Bear Stearns (Sentiment)
Bullish sentiment still too high; SPX 77%, NDX 76%, 5 day moving average 80 and 79%. Equity PUT/CALL up small to .52, SPX P/C down TO 1.57. SPX is 35 points away from the 200 DAY MA, NDX is 60 points away.

Weisel Partners (Communications Components)
Cautious on near-term valuations after strong recent rally; Believe BRCM, PMCS & JDSU are the premium big-cap names w/ best prospects for sustainable longer-term growth.

Smith Barney Shearson (Strategy)
Historically, when negative EPS revisions outnumbered positive revisions by two to one, a market bottom was forming. We reached this in September and the ratio is increasingly favoring negative revisions. Fundamentals are still deteriorating but stocks are beginning to reflect a recovery--now is the time to buy, in our view. Consumer stocks will lead the recovery and Barnes & Noble and Borders Group in our opinion will outperform.

Lehman Bros (Storage Networking)
Initiating coverage on the industry with a Market Perform rating. We do not believe these companies will start to show fundamental improvement until the second half of next year.

Merrill Lynch (Electronics Manufacturing)
The sector now looks overvalued, given the near-term fundamentals. We are modeling for only 6% sales growth next year.

Deutsche Banc Alex Brown (Wireless)
We are trimming handset sales forecasts, to 383 million this year and 432 million for 2002.

SG Cowen (Managed Care)
We believe HMO's will be able to increase prices by 16% on average next year, up from this year's 12% rise. Our top picks remain HUM, UNH, and WLP.

Credit Suisse First Boston (Semiconductors)
We believe the industry is bottoming, but the recovery will be gradual. The current bear market rally will likely retrench, and we believe the will be better buying opportunities in the next few months.

Morgan Stanley Co. (Strategy)
We still believe the global economy is weakening, and that a V-shaped recovery will happen much later than expected. We would buy bonds and Energy stocks.

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Oscillator: 5.2

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8:30 AM: International Trade Balance for September. The August reading came in at a deficit of $27.1 billion.

9:00 a.m. BTM Chain Store Sales

10:00 AM: The Conference Board's Index of Leading Economic Indicators for October. The September reading was -0.5%.

10:30 a.m. LJR Redbook

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Credit Suisse First Boston European Large Cap Pharmaceuticals Conference London -- GSK, SHR, AZN

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GLM Shareholder Meeting

LOW Analyst/Investor Meeting

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