CHANGE IN RATINGSAflac ( AFL) downgraded at Barclays from Equal-weight to Underweight. $20 price target. Valuation call, based on the company's book value. BJ Services ( BJS) downgraded at Barclays from Overweight to Equal-weight. $13 price target. Pressure pumping market will likely remain weak through 2010. Brocade ( BRCD) upgraded at Goldman Sachs to Buy from Neutral. Expect higher Street estimates and multiple expansion as Cisco pushes into server market. Shares are still down 37% in 2009, leaving additional upside as a result of improved competitive position. Price target raised to $6.50 from $3.75.
Quest Diagnostics ( DGX) downgraded at Jefferies. Rating lowered to Hold from Buy. Maintains price target of $59. Raises 2009 EPS estimates of $3.66 from $3.55. Brinker ( EAT) upgraded at Goldman Sachs to Buy from Neutral based on changes in cost structure. Expect meaningful margin improvements over several quarters despite continued pressure on same store sales. Price target raised to $22 from $18. Ford ( F) upgraded at Goldman Sachs to Buy from Neutral based on structural changes in auto industry and improved 2009 sales expectations. Note company's sufficient liquidity to make it through to 2010 without additional funding (unlike GM). Price target raised to $6 from $2.25. FedEx ( FDX) upgraded at Merrill/BofA to neutral from underperform and price target increased to $56 from $48. Price target is slightly below its 16-year historical forward P/E average of 16.5x, and within its 13.0x-20.1x historical trading range. While ML's F2010 estimate is a slight decline from F2009, target multiple was increased to 16x from 13.5x due to reduced regulatory overhang. General Dynamics ( GD) upgraded at Goldman Sachs to Buy from Neutral based on valuation and bottoming sentiment. View investor fears over Army/supplemental exposure as overdone and note management's capitulation on bizjets. Price target raised to $54 from $43. Halliburton ( HAL) downgraded at Barclays from Overweight to Equal-weight. $22 price target. Valuation call, as rig activity should remain low into 2010. Intrepid Potash ( IPI) downgraded at Goldman Sachs to Sell from Neutral based on overdone rally in potash stocks. Expect poor spring results as buyers protest record high prices. Believe retailers and farmers lack incentive to re-order potash at inflated prices, especially considering high inventory levels. Price target raised to $15 from $14.
Lockheed Martin ( LMT) downgraded at Goldman Sachs to Neutral from Buy. Shares are up 35% off March lows, making current levels attractive for profit taking. Also noted limited near-term catalysts. Price target raised to $80 from $73. Prudential ( PRU) downgraded at Barclays from Equal-weight to Underweight. $27 price target. Valuation call, based on the company's book value. Valspar ( VAL) upgraded at Goldman Sachs to Neutral from Sell based on improved near-term expectations for earnings. Consumer trends have improved in March and April, which bodes well for upcoming earngins announcement. Price target raised to $22 from $15.
STOCK COMMENTS / EPS CHANGESAltera ( ALTR) estimates, target raised at Merrill/BofA to $20. Estimates also increased, because of higher sales in Asia. Buy rating. Advanced Micro ( AMD) numbers raised at Barclays through 2010. Company seeing higher sales, and controlling operating expenses. Equal-weight rating and new $4 price target. Blackrock ( BLK) numbers raised at Barclays through 2010. Company is realizing higher Solutions revenue and was helped by a lower tax rate last quarter. Overweight rating and new $134 price target. Conagra ( CAG) target raised at Merrill/BofA to $20. Company has re-financed debt and is showing top-line growth in North America. Buy rating. Cisco ( CSCO) estimates cut, target raised to $19 a share at Barclays Capital said. Estimates were lowered through 2010, as enterprise demand has not yet improved meaningfully. Equal-weight rating. Delta Air Lines ( DAL) target raised at Merrill/BofA to $12. Company lost less than expected last quarter, as revenue trends have stabilized. Buy rating.
Merck ( MRK) estimates reduced at Barclays through 2010. Company facing higher foreign exchange costs and wholesalers are working down inventory. Overweight rating and $31 price target. Union Pacific ( UNP) added to US 1 list at Merrill Lynch/Bank of America. Volumes declines appear to have stabilized, and management is aggressively cutting costs. Buy rating. Western Union ( WU) numbers upped at Barclays to $20. Estimates also increased, as lower service costs boosted margins last quarter. Overweight rating.