bstocksdev

Analyst upgrades:

• Citigroup raised Ann Taylor (NYSE: ANN) to Hold from Sell. The firm upgraded shares following the company's Q2 upside and believes guidance for the second half of 2008 is appropriately conservative.
  
• Jefferies upgraded China Sunergy (NASDAQ: CSUN) based on valuation,and improved liquidity and silicon supply outlook.
  
• Stephens upgraded infoUSA (NASDAQ: IUSA) shares to Overweight from Equal Weight to reflect the stock's valuation, new management, improvements in expense controls and the potential to become a takeover target.
  
• Citigroup raised BB&T (NYSE: BBT) to Buy from Hold.
• Stifel upgraded Leggett & Platt (NYSE: LEG) to Buy from Hold.

Analyst downgrades:

• Citigroup downgraded Cablevision (NYSE: CVC) to Sell from Buy as they do not expect the company's structural moves to unlock value.
  
• Wachovia dropped Knight Transportation (NYSE: KNX) to Market Perform from Outperform based on valuation.
  

Financials have staged an impressive rally from extremely oversold levels," says Kelley Wright, editor of the top-rated IQ Trends, which focuses on high quality, blue chip, dividend-paying stocks. Here's his top long-term buys among banks.

"It is increasingly evident that the banking sector is dividing into two distinct camps; the have's and the have not's. The 'have's' are:

Bank of America (NYSE: BAC) and Wells Fargo (NYSE: WFC) among the big cap area;
SunTrust (NYSE: STI) and BB&T Corp. (NYSE: BBT) in the larger regional banking sector;
Bank of Hawaii (NYSE: BOH) and Southwest Bancorp (NASDAQ: OKSB) in the smaller cap area.

"The impressive rally to date notwithstanding, it still remains to be seen whether another retracement will develop should crude oil, gold and other commodities reverse course.

"A strong rally in these sectors could send the market down again. While Mr. Market can do whatever he pleases, it is highly unusual for stocks to bottom in the summer.

"It would not be imprudent to see what September and October have to offer before anyone begins to talk seriously about the bottom. For investors with an appetite for the financials, however, we would suggest dusting off that old tried and true tactic of dollar cost averaging as a prudent means to establish positions."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.

TheStreet.com's Jim Cramer says our problems are so widespread, he sees lots more IndyMacs before we're out.

You don't need me to tell you it's awful out there. You don't need me to tell you that there's no quick fix for any of these things. But what might help you understand why it feels so bad this time is that I have never, in my career, seen so many companies go off track at the same time. This is one unbelievable moment, and it is made more horrible by the day as companies' stocks just get pummeled, causing people to then question the very viability of the companies involved.

First, obviously, are Fannie Mae (NYSE: FNM) (Cramer's Take) and Freddie Mac (NYSE: FRE) (Cramer's Take). We don't know what will happen, but we do know that their futures are much darker than their pasts. Their best hope: a Democrat becomes president and shows the usual love to both. But as investments, they are pretty much perma-losers going forward. The losses are that heavy. Yes, it is true that two years from now they will be better, but will the government let them limp through to that? View them as calls on a Democratic win.

We all know that Citigroup (NYSE: C) (Cramer's Take), Wachovia (NYSE: WB) (Cramer's Take), Washington Mutual (NYSE: WM) (Cramer's Take) and National City (NYSE: NCC) (Cramer's Take) are in trouble. Bank of America (NYSE: BAC) (Cramer's Take) says it isn't in trouble, but obviously the market doesn't believe management because the stock failed to rally when it said its dividend was safe. Any short-selling hedge fund could hire 30 actors and have them line up at a Washington Mutual or two and get a bank run going. Then we would have to hear about a "hasty" Treasury department plan to bail out WM. Hasty? How can these guys not see it coming?

After the implosion of IndyMac Bancorp (NYSE: IMB) and news of the deterioration of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) last week, there's bound to be a certain level of trepidation as the earnings crunch begins this coming week and many big financial companies report. Here's a look at what Wall Street was expecting (see The week in preview: Expectations as the earnings crunch begins for expectations of other reporting companies.)

Analysts surveyed by Thomson Financial are expecting the following of companies to report lower earnings when compared to the same period of the previous year.

• JPMorgan Chase & Co. (NYSE: JPM): 44 cents EPS (-63.3%) on sales of $16.4 billion (-13.2%)
• Comerica Inc. (NYSE: CMA): 51 cents EPS (-59.2%) on sales of $680.2 million (-7.3%)
• Zions Bancorp. (NYSE: ZION): 75 cents EPS (-47.6%) on sales of $627.3. million (+2.7%)
• Huntington Bancshares Inc. (NYSE: HBAN): 23 cents EPS (-32.4%) on sales of $617.1 million (+50.7%)
• Capital One Financial Corp. (NYSE: COF): $1.31 EPS (-30.7%) on sales of $4.4 billion (+7.8%)
• Wells Fargo & Co. (NYSE: WFC): 50 cents EPS (-25.4%) on sales of $10.7 billion (+7.7%)
• M&T Bank Corp. (NYSE: MTB): $1.50 EPS (-23.1%) on sales of $756.6 million (+1.6%)
• BB&T Corp. (NYSE: BBT): 69 cents EPS (-16.9%) on sales of $1.8 billion (+5.9%)
• U.S. Bancorp (NYSE: USB): 60 cents EPS (-7.7%) on sales of $3.8 billion (+8.3%)
• PNC Financial Services Group Inc. (NYSE: PNC): $1.16 EPS (-7.2%) on sales of $1.9 billion (+8.5%)

MOST NOTEWORTHY: The U.S. bank sector, oil refiners and SGX Pharmaceuticals were today's noteworthy initiations:

• Credit Suisse initiated coverage on U.S. banks, starting shares of BB&T Corporation (NYSE: BBT), Colonial BancGroup Inc (NYSE: CNB) and Zions Bancorporation (NASDAQ: ZION) with Outperform ratings.
• Banc of America assumed coverage of the oil refiners but remains neutral on the group given near-term risks to gasoline inventories and margins. They assumed Valero Energy Corporation (NYSE: VLO) with a Neutral rating and $60 target and Western Refining Inc (NYSE: WNR) with a Sell rating and $35 target.
  
• Cantor believes SGX Pharmaceuticals Inc's (NASDAQ: SGXP) platform technology for the treatment of cancer provides significant advantages that can accelerate drug discovery and lead optimization, while lowering costs. The firm started shares with a Buy rating and $9 target.

OTHER INITIATIONS:

• Morgan Keegan started shares of Motorola Inc (NYSE: MOT), Apple Inc (NASDAQ: AAPL) and Napster Inc (NASDAQ: NAPS) with Market Perform ratings and RealNetworks Inc (NASDAQ: RNWK) with an Outperform rating.
  
• Lehman initiated shares of Time Warner Inc (NYSE: TWX) with an Overweight rating and $25 target.
  
• Virtusa Corporation (NASDAQ: VRTU) was assumed with an Overweight rating at JP Morgan and with an Outperform rating and $16 target at Bear Stearns.

As the world's payment systems shift from paper to pulse, world commerce becomes increasingly dependent on the reliability and integrity of transaction software specialists. Among the leaders in the field is a New York firm that has been serving financial clients for almost thirty years.

Transaction Systems Architects (NASDAQ: TSAI) sells software products and services that make electronic payments possible. The programs process transactions involving ATMs, credit cards, debit cards, wire transfers, home banking services and point-of-sale terminals. Company services involve design, implementation and facilities management. Customers include financial institutions, retailers and e-payment processors. Bank of America (NYSE: BAC) and BB & T Corporation (NYSE: BBT) are two of the big names on the firm's client list. First Data Corporation (NYSE: FDC) is a major competitor.

BB&T (NYSE: BBT) recently released 1Q 2007 figures. In those areas of operations affected by interest rates, the news is nothing to boast of. Net income for 1Q 2007 was $421 million, $0.77 per diluted share. This is down 2.5% from 1Q 2006. Shareholder equity also declined by 1% from 1Q 2006. BB&T CEO John Allison states that he is nonetheless pleased with BB&T's 1Q performance, given "a challenging interest rate environment and a slowing economy." Allison points out that BB&T still experienced both loan and deposit growth during 1Q 2007.

The upside of a slowing economy is that more people need to borrow more money, or need fee-earning services to help them move money around more efficiently. All of BB&T's noninterest income generating business units had a good quarter. Total non-interest income was up 7.2% to $652 million for the quarter. These units included insurance operations for property and casualty coverage, which experienced 11.9% growth to $197 milion, based mainly on higher insurance commissions. Revenue from trust administration services increased 8% to $40 million. Service charges for overdrafts were also a big money maker for BB&T, increasing over 5% to $138 million just for 1Q 2007. That's a lot of bouncing checks covered. Credit card related services increased almost 12% to $114 million for the quarter.

BB&T grew both organically and by acquisition during 1Q 2007. Average loans and leases increased 12.5%, $9.5 billion, to just shy of $85 billion for the quarter. Across the board, commercial loans and leases, as well as consumer mortgages and loans increased in size. BB&T also acquired AFCO Credit Corporation, with over $1 billion in its loan portfolio. Not everybody was trying to borrow more money. Average deposits, both commercial abd consumer, increased %11 to $82.5 billion. And BB&T is aggressively expanding its online banking services to capture even more deposits at a reduced cost. BB&T added over 5,000 new online banking accounts in 1Q alone.

Also during 1Q, BB&T bought Coastal Financial Corporation for $395 million. This will give BB&T numerous retail locations in the high-growth areas of the Carolinas, in addition to BB&T's 1,400 existing locations in 11 states. This far, the slowing economy has been good news for BB&T.

MOST NOTEWORTHY: The initiation of the Regional Banks sector was today's most notable move:

• Stifel initiated Wells Fargo (NYSE: WFC) with a Buy rating and $41 target as they believe the company is best in class given its strong capital position, effective risk management and better than average EPS growth rates.
• Stifel initiated with a Hold rating: Bank of America (NYSE: BAC), Wachovia (NYSE: WB) and Fifth Third (NASDAQ: FITB).
• Stifel transferred coverage of the following names with Hold ratings: BB&T Corp (NYSE: BBT), Comerica IncCMA), SunTrust Banks (NYSE: STI), US Bancorp (NYSE: USB). Note USB was transferred and downgraded to Hold from Buy.
• Stifel initiated Regions Financial (NYSE: RF) with a Sell rating and $33 target as they believe the AmSouth merger is likely to prevent a near-term catalyst, and transferred coverage of National City (NYSE: NCC) with a Sell rating and $33 target, downgraded from Hold, as they believe consensus estimates need to come down to reflect several challenging trends.

OTHER INITIATIONS:

• JMP Securities started TiVO Inc (NASDAQ: TIVO) with a Market Outperform rating, expecting the company to gain a larger piece of the DVR market in the late spring/early summer.

• Wedbush initiated Lions Gate Entertainment Corp (NYSE: LGF) with a Buy rating and $13 target.

• BMO Capital started Bristol Myers Squibb (NYSE: BMY), Wyeth (NYSE: WYE) and Pfizer Inc (NYSE: PFE) with Market Perform ratings and Eli Lilly (NYSE: LLY), Merck & Co (MRK) and Schering Plough (NYSE: SGP) with Outperform ratings.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

AerCap Holdings (NYSE:AER) quiet-period ends: AER started as Outperform at Wachovia, as Overweight at Morgan Stanley and Lehman, and as Buy at Merrill Lynch.

Goldman Sachs is mostly negative and cautious on select Chip Stocks:
Applied Materials (NASDAQ:AMAT) cut to Sell. Advanced Micro Devices (NYSE:AMD) cut to Sell. Credence Systems (NASDAQ:CMOS) cut to Sell. Micron (NYSE:MU) raised to Neutral. Texas Instruments (NYSE:TXN) raised to Neutral.

Amazon.com, Inc. (NASDAQ:AMZN) cut to Sell at Citigroup; cites margin and business pressures.

A.G.Edwards started new coverage in many financial companies:
BB&T Corp. (NYSE:BBT) started as Hold. Fiserv (NASDAQ:FISV) cut to Hold. Regions Financial (NYSE:RF) started as Sell. Sun Trust (NYSE:STI) started as Hold. Wachovia Corp. (NYSE:WB) started as Hold. Wilmington Trust (NYSE:WL) raised to Buy.

General Motors Corp. (NYSE:GM) cut to Sell at B of A; GM shares were trading down almost 1% pre-market.

The Home Depot Inc. (HD) raised to Strong Buy at Raymond James, oddly enough this was before Nardelli said he was leaving.

Merck & Co. (NYSE:MRK) raised to Outperform at Bear Stearns; stock was up 1% pre-market.

ONEOK (NYSE:OKE) named as Conviction Buy at Goldman Sachs on discounted valuation.

Telik (NASDAQ:TELK) was cut to Peer Perform at Bear Stearns. If that isn't just a carryover from a weekend call or last week this one is a bit late.

You can access the full list of analyst Calls from 24/7 Wall St. here.