Analyst Upgrades

• Abercrombie & Fitch (ANF) to outperform from market perform at Wells Fargo.
• Trinity Industries (TRN) to buy from hold at BB&T.
• Cameron (CAM) to outperform from sector perform at RBC Capital.
• Expedia (EXPE) to positive from neutral at Susquehanna.
• Micron (MU) to buy from hold at Lazard Capital.

Two companies devoted to consumer products released earnings this week. One makes items used for cleaning, the other makes goods that you can actually eat.

We'll start with the cleaning-item concern. The Clorox Company (CLX), manufacturer of the iconic laundry bleach, issued results for its fiscal second quarter earlier today. At the time of this writing, shares were higher by 2.4% to a quote of $65.26. Volume was strong. The 52-week low for the stock is $59.07 and the 52-week high is $69. The one-year chart is, well ... not that great.

Analyst Upgrades

• Micron (MU) to buy from neutral at UBS.
• Baker Hughes (BHI) to outperform from market perform at BMO Capital.
• PDL BioPharma (PDLI) to outperform from sector perform at RBC Capital.
• Fluor (FLR) and Rush Enterprises (RUSHA) to buy from neutral at BofA/Merrill.
• Camden Property (CPT) to outperform from neutral at Macquarie.
• Pinnacle Financial (PNFP) to buy from hold at Wunderlich.
• Linear Technology (LLTC) to neutral from reduce at Nomura.
• Hologic (HOLX) and Illumina (ILMN) to buy from hold at Citigroup.
• F5 Networks (FFIV) to buy from neutral at Gleacher.

Analyst Upgrades

• TCF Financial (TCB) to buy from hold at Deutsche Bank.
• Exelon (EXC) to market perform from underperform at Wells Fargo.
• Nvidia (NVDA) and Boyd Gaming (BYD) upgraded to overweight from equal weight at Barclays.
• Estee Lauder (EL) to buy from neutral at UBS.
• Webster Financial (WBS) to buy from hold at Jefferies.
• Skilled Healthcare (SKH) to outperform from market perform at Morgan Keegan.
• Acorda Therapeutics (ACOR) to outperform from market perform at Leerink.
• NCR Corp. (NCR) to outperform from neutral at Wedbush.
• Barnes & Noble (BKS) to neutral from underperform and Pioneer Natural (PXD) to outperform from neutral at Credit Suisse.
• Autodesk (ADSK) to buy from neutral at Goldman.

Bellwether Clorox (CLX) is facing trouble on two fronts, The Wall Street Journal reported Monday as the company projected disappointing second quarter earnings. First, the purchase of the personal care unit Burt's Bees did not pan out as expected, forcing the company to writedown between $250 million to $255 million for goodwill on a purchase of $925 million.

Next, the recession is taking its toll. Consumers are extremely cost conscious and are turning to discount brands. Standard Clorox brands, such as disinfectants, bleach and Fresh Step and Scoop Away cat litter, have experienced weakness.

As goes the first day of trading, so goes the year. That is what many investors believe in one form or variation. Another expansion in manufacturing helped and bonds started out weak. The real culprit for gains was more gains in overseas stock markets followed by expectations for more positive gains in 2011. If you weight the DJIA components equally, I even have a formula that calls for the DJIA moving above 13,000 in 2011. That formula last year came within about 1% of the DJIA close in 2010.

Here are today's closing bells:

Dow Jones 11,670.75 +93.24 (0.81%)
S&P 500 1,271.87 +14.23 (1.13%)
Nasdaq 2,691.52 +38.65 (1.46%)

Best Dow Stocks and Worst Dow Stocks for the year
Top Analyst Upgrades & Downgrades

Clorox (CLX - option chain) stock is trading lower today after the company said this morning it expects fiscal-Q2 sales to decline 3% to 4% compared to Q1. That translates to sales of $1.215 to $1.228 billion, compared to Q1 revenue of $1.266 billion. CLX also forecast adjusted earnings of 57 to 63 cents per share. Analysts have forecast a profit of 73 cents per share on revenue of $1.19 billion. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on CLX.

This morning, CLX opened at $61.58. So far today the stock has hit a high of $61.79 and a low of $60.56. As of 12:15, CLX is trading at $61.32, down $1.96 (-3.1%). The chart for CLX looks neutral and S&P gives CLX a neutral 3 STARS (out of 5) hold ranking.

Clorox (CLX), at the time of this writing, was down 4% to $63.55. The 52-week high for the stock is $69. The chart shows an equity that seemed to be doing relatively well for a while until today's notable drop. Should investors avoid the company at this point?

Hey, we're talking Clorox, correct? This is a long-term, core vehicle that one doesn't dump simply because it's experiencing a bit of trouble. Nevertheless, there are some issues that shareholders need to know.

Analyst Upgrades

• Jefferies upgraded Computer Sciences (CSC) to buy from hold and raised its target to $53 from $47. The analyst said Computer Sciences' valuation has created one of the best LBO opportunities in several years and could provide a five year IRR of 25+%.
• Keefe Bruyette upgraded Comerica (CMA) to outperform from market perform, citing strength of the company's capital. The firm raised its target for shares to $44 from $43.
• RBC Capital upgraded Nokia (NOK) to outperform from sector perform and raised its price target to $14 from $12. The firm upgraded shares based on valuation, reduced execution risk on software development, and potential catalysts from new devices based on Symbian^3. RBS upgraded Nokia to buy from hold after the company named Stephen Elop as CEO.
• Allstate (ALL) was upgraded to buy from hold at Citigroup.
• Coca-Cola Enterprises (CCE) was upgraded to buy from neutral at BofA/Merrill.
• Moody's (MCO) was upgraded to overweight from neutral at Piper Jaffray.

"What's the link between Kingsford charcoal, Hidden Valley salad dressing, Brita water filtration systems, Glad garbage bags and Burt's Bees personal care products?" asks Dr. Mevlin Pasternak. "

"Surprisingly, these diverse products are all brands of Clorox (CLX), which is thought of by many people as just 'the bleach company,'" says the editor of Double-Digit Trading.

"A leading manufacturer of cleaning products and consumer stapes, Clorox sells some of the most recognized and often trusted household names. In fact, consumers rank nearly all of Clorox's products as top brands.

The Clorox Company (CLX) shares haven't done too badly over the last twelve months. The chart shows something of an upward bias to the stock. It was trading near the 52-week high of $66.44 after the consumer-products company issued its fiscal fourth-quarter report on Tuesday.

The reaction to the news wasn't so enthused. Shares closed down slightly to $64.47. Of course, it was a lot better than what happened to colleague The Procter & Gamble Company (PG). That stock saw a significant sell-off on its quarterly data.

Analyst upgrades:

• Oppenheimer upgraded Goldman Sachs (GS) to Outperform from Perform following the company's $550M settlement with the SEC. Opco has a $213 price target for Goldman shares. BofA/Merrill upgraded Goldman Sachs to Buy from Neutral and raised its price target to $182 from $160.
• Wells Fargo upgraded JP Morgan (JPM) to Outperform from Market Perform following the company's Q2 results citing valuation and lower credit costs. The firm keeps a valuation range for shares of $48-$51.
• Goldman upgraded Murphy Oil (MUR) to Buy from Neutral and has a $61 price target on the stock. The firm cites Murphy's Eagle Ford growth and valuation for the upgrade.
• Precision Cast (PCP) was upgraded to Outperform from Neutral at Credit Suisse.
• Pride International (PDE) was upgraded to Buy from Hold at Jefferies.
• BHP Billiton (BHP) was upgraded to Overweight from Neutral at HSBC.

In the year following Bush's dividend tax cuts, the Dow Jones rose 16%. When the tax cuts expire in a few months, will the market drop?

One method of evaluating stocks is that they are worth the present value of all the future cash flows. This can make dividend stocks particularly attractive to investors because they get paid rent or a dividend for holding a company. If conditions change and those future dividends are no longer expected, a stock can suddenly be worth a lot less. This is a large reason why we see stocks drop suddenly at earnings announcements or when companies revise outlooks.

The markets are up today, but that doesn't seem to be helping The Clorox Company (CLX). At the time of this writing, shares were fighting the good fight between red-and-green status: they were down 0.2% right after being slightly higher by the same amount during the moments it took me to complete this sentence.

It's the earnings game, folks; Wall Street was cool to the numbers. According to MarketWatch, net income of $1.16 per share was eight pennies ahead of estimates. That doesn't sound so bad, does it?

"Our primary purpose at Investment Quality Trends is to assist investors in growing their capital and income base from which to derive cash for their current and future needs," says Kelley Wright.

The editor of IQ Trends explains, "To that end we believe that high-quality stocks purchased at historically low-price-to-high-yield offers the best potential for downside protection and upside appreciation.