Analyst Upgrades

• Walgreen (WAG) and Triumph Group (TGI) to buy from neutral at UBS.
• Focus Media (FMCN) to buy from neutral at Goldman.
• Home Depot (HD) to outperform from market perform at FBR Capital.
• Arbitron (ARB) to overweight from neutral at JPMorgan.
• Waddell & Reed (WDR) and Legg Mason (LM) to overweight from equal weight, and Janus Capital (JNS) to overweight from underweight, at Barclays.
• Central Euro Media (CETV) to buy from hold at Deutsche Bank.
• GenOn Energy (GEN) and Ntelos (NTLS) to outperform from sector perform at RBC Capital.
• Cooper Tire (CTB) to buy from neutral and Goodyear Tire (GT) to buy from underperform at BofA/Merrill.

Analyst Upgrades

• Wells Fargo upgraded Accenture (ACN) to outperform from market perform following the company's Q4 results, citing improved tone and increased visibility. The firm raised its target range for shares to $51 to $53 from $41 to $44.
• Macquarie upgraded FirstMerit (FMER) to outperform from neutral and has a $21 price target on the stock. The firm cites FirstMerit's strong fundamentals and competitive advantage for the upgrade.
• Macquarie transferred coverage on Marshall & Ilsley (MI) with a neutral from an underperform based on improved risk/reward.
• Eaton (ETN) was upgraded to overweight from neutral at JPMorgan.
• HSBC (HBC) was upgraded to conviction buy from buy at Goldman.
• Walgreen (WAG) was upgraded to overweight from equal weight at Morgan Stanley.

I never would have predicted such a bullish reaction. As I write this, Walgreen (WAG) is up over 12% to $34.04 on the back of an earnings report. With one hour to go before the market closes, volume is huge.

Those of you who bought prior to the report could not have possibly expected this. It represents a big departure from the last time the drugstore posted results. Back in June, shareholders were disappointed with their investment since Wall Street thought the stock should be sold off on the data. It's like night and day this afternoon.

Walgreen Co. (WAG), which recently began carrying fresh fruit and vegetables in some of its stores, is scheduled to discuss its fourth-quarter fiscal 2010 financial results Tuesday, September 28, in a conference call beginning at 8:30 AM (ET). You can catch a live webcast of the call at the company's website.

During the three months that ended in August, Deerefield, Ill.-based Walgreen launched a social responsibility website and boosted its dividend. Analysts surveyed by Thomson Reuters are looking for the drugstore chain operator to report that its earnings for that period were about the same as a year ago, or 44 cents per share. Revenue is expected to total $16.8 billion, which is a 7.3% increase from the same period of last year. And for the full year, analysts forecast EPS of $2.12 (+4.7%) on revenue of $67.4 billion (+6.4%).

One of the most prominent quarterly reports scheduled this week, as the quarter winds down, comes from Walgreen (WAG). Analysts surveyed by Thomson Reuters are looking for the drugstore chain operator to report Tuesday that its fiscal fourth-quarter earnings were about the same as a year ago, or 45 cents per share. Note, though, that Walgreen fell short of earnings expectations in the previous two quarters.

During the three months that ended in August, Deerefield, Ill.-based Walgreen launched a social responsibility website and boosted its dividend. Revenue for that period is expected to total $16.8 billion, which is a 7.3% increase from the same period of last year. And for the full year, analysts forecast EPS of $2.12 (+4.7%) on revenue of $67.4 billion (+6.4%).

Rite Aid's (RAD) sell-off Thursday was almost comical. Sometimes you've just got to laugh when a stock that's trading around a dollar suddenly drops over 13%. That's exactly what the drugstore's shares did by the end of the day's regular session. It finished at a quote of 95 cents. And, as you might expect, volume was pretty significant.

Who buys a stock like this? Clearly, someone braver than me. Adding this one to a portfolio is basically no different than playing the slots in Vegas. The one-year chart hasn't changed much since I discussed the company back in June; it still tells a tale of volatility and downward momentum. It's not a ride I'm willing to take.

"Investing in conservative stocks to build or rebuild the core of your portfolio makes sense right now; investors should buy companies that have a long history of steady earnings and dividend growth, through good times and tough times," says J. Royden Ward.

The editor of the specialty newsletter, Cabot Benjamin Graham Value Letter, explains, "The obvious benefit of adhering to a disciplined system of value investing like ours is that you build long-term profits and, ideally, financial independence.

I first wrote about Walgreen (WAG) here on February 17, 2009, at a price of $25.46, and shares of drug store chain giant have totally misbehaved in the past three months, which has raised some caution flags.

Walgreen dipped below $30 on a spat with CVS Caremark (CVS) over reimbursements for drug prescriptions, which, thankfully, was resolved this week, Reuters reported. Terms were not disclosed.

Walgreen Co. (WAG - option chain) shares rose Friday after the company said it signed a new agreement with CVS Caremark (CVS) that will allow Walgreen to continue participating in CVS's pharmacy benefit management network. Financial terms of the deal were not disclosed. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on WAG.

WAG opened at $31.01. In morning trading, the stock hit a low of $30.18 and a high of $31.38. As of 12:00, WAG was trading at $30.37 up 1.10 (3.8%). The chart for WAG looks bullish and S&P gives WAG a positive 4 STARS (out of 5) buy ranking.