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Blue Chips Making Waves and Changing Ratings

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


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.


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
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


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

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