Blue Chips Making Waves and Changing Ratings

Updating our list of buy, hold and sell blue chip stocks

Mar 12, 2013, 10:30 am EDT | By Louis Navellier , NavellierGrowth.com

If you go to my Portfolio Grader tool and look up today’s biggest gainers on the S&P 500, you’ll see that today’s best performing stocks are C- and even D-rated. How could this be happening?

Well, in a normal environment, the best-rated stocks (As and Bs) are the ones that beat the market day in and day out. But the strong bull market we’re seeing right now is anything but normal. The fact that the chaff is rising along with the wheat is a big red flag for choppiness to come.

I’ll discuss this further over the next few weeks, but the market should narrow as it climbs higher. While investors have turned a blind eye to some companies’ dubious fundamentals, I expect many will wise up during first-quarter earnings season. This will spark a flight to quality that should normalize the market.

To prepare for the bumpiness to come, let’s look at the 40 big blue chips that have been upgraded and downgraded this weekend. After taking a close look at the latest data on institutional buying pressure and each company’s fundamental health, I decided to revise my Portfolio Grader recommendations for each of the stocks listed below.

Upgrades

Last Week’s Holds, Now Buys

Symbol	Company Name	Quantitative Grade	Fundamental Grade
ADBE	Adobe	B	C
AMP	Ameriprise Financial	B	B
BAC	Bank of America	B	C
BX	Blackstone Group L.P.	B	B
CBG	CBRE Group	C	A
CRM	salesforce.com	B	C
ERIC	Ericsson	B	C
EW	Edwards Lifesciences	B	B
GPC	Genuine Parts	B	B
HON	Honeywell	B	B
NLSN	Nielsen Holdings	B	C
NTRS	Northern Trust	B	C
UAL	United Continental	B	D

Last Week’s Sells, Now Holds

Symbol	Company Name	Quantitative Grade	Fundamental Grade
ADM	Archer Daniels	D	C
LFC	China Life Insurance	C	C
MCD	McDonald’s	D	C
NLY	Annaly Capital Management	C	C
NUE	Nucor	C	C
TXN	Texas Instruments	C	C
VOD	Vodafone Group PLC	C	C
XRX	Xerox	D	C
YNDX	Yandex	D	B
YUM	Yum! Brands	C	C

Downgrades

Last Week’s Buys, Now Holds

Symbol	Company Name	Quantitative Grade	Fundamental Grade
AGN	Allergan	C	C
BMY	Bristol-Myers	B	C
CAH	Cardinal Health	C	B
HBC	HSBC Holdings	B	C
KORS	Michael Kors	C	A
LYG	Lloyds Banking	B	C
PETM	PetSmart	C	B
TM	Toyota	B	D
VAL	Valspar	C	C
WAG	Walgreen	B	D

Last Week’s Holds, Now Sells

Symbol	Company Name	Quantitative Grade	Fundamental Grade
AMAT	Applied Materials	D	C
DLTR	Dollar Tree	D	B
ISRG	Intuitive Surgical	D	B
LTD	Limited	D	C
MJN	Mead Johnson	D	B
MNST	Monster Beverage	D	C