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Google Inc. (NASDAQ:GOOG), Barclays Plc (NYSE:BCS), and Biogen Idec Inc. (NASDAQ:BIIB) had received positive upgrades from analysts recently. In this article, these three stocks will be analyzed fundamentally and technically. Investing strategies will also be reviewed.

Google Inc.

Google was up 1.22% and closed at $799.78 on February 27, 2013. GOOG had been trading in the range of $556.52-$808.97 in the past 52 weeks. GOOG has a market cap of $263.66B and a beta of 1.04.

On February 27, 2013, BofA/Merrill Lynch upgraded GOOG from Neutral to Buy with a price target of $920.00 (from $790.00). As reported, "Analysts see multiple expansion and revenue growth at Google in the second half of the year. Gains will be driven by the Enhanced Campaigns rollout and increase revenues from Product Listing Ads, and analysts also see potential for Motorola product launches." Analysts have a mean target price of $843.60 with a median target price of $835.00 for GOOG.

There are a few positive factors for GOOG:

Strong revenue growth (3-year average) of 28.5

  • Higher operating margin of 25.4% and net margin of 21.4% (vs. the industry average of 17.0% and 18.7%)
  • Stronger ROE of 16.5 (vs. the average of 13.6)
  • Lower P/E, P/B, and P/S of 24.4, 3.6, and 5.1 (vs. the industry averages of 27.5, 3.9, and 5.8)
  • GOOG has a total cash of $48.09B with a total debt of $7.21B
  • GOOG generates an operating cash flow of $16.62B with a levered free cash flow of $10.77B

Technically, the MACD (12, 26, 9) indicator is showing a slightly bearish trend. The momentum indicator, RSI (14), is indicating a strong bullish lean at 65.02. GOOG is currently trading above its 50-day MA of $747.67 and 200-day MA of $676.95. The next resistance is $802.82, the R2 pivot point, as seen from the chart below.

(click to enlarge)

Source: StockCharts.com

How to Invest

For bullish investors, a credit put spread of May 18, 2013 $680/$700 put can be reviewed to gain some upside credit premium or to acquire the stock at a price below $700. Investors can also review the following ETFs (with top 4 weighting) to gain exposure to GOOG:

  • DJ Internet Index Fund (NYSEARCA:FDN), 9.95% weighting
  • Dow Jones U.S. Technology Index Fund (NYSEARCA:IYW), 8.24% weighting
  • Nasdaq Internet Portfolio (NASDAQ:PNQI), 7.94% weighting
  • Goldman Sachs Technology Index Fund (NYSEARCA:IGM), 7.18 weighting

Barclays PLC

Barclays was up 2.10% and closed at $18.48 on February 27, 2013. BCS had been trading in the range of $9.23-$20.60 in the past 52 weeks. BCS has a market cap of $58.32B and has a high beta of 2.70.

On February 27, 2013, Numis upgraded BCS from Add to Buy. On February 21, 2013, Bernstein also upgraded BCS from Market Perform to Outperform. Analysts have a mean target price of $20.40 and a median target price of $20.40 for BCS.

There are a few positive factors for BCS:

  • Lower debt/equity of 0.4 (vs. the industry average of 2.1)
  • Lower P/B and P/S of 0.7 and 1.2 (vs. the averages of 0.8 and 2.0)
  • BCS currently offers an annual dividend yield of 2.21%

Technically, the MACD (12, 26, 9) indicator is showing a bearish trend, but the MACD difference converged in the last trading day. RSI (14) is picking up but still indicates a slightly bearish lean at 47.39. BCS is still trading above its 50-day MA of $18.31 and its 200-day MA of $14.13, as seen from the chart below.

(click to enlarge)

Source: StockCharts.com

How to Invest

For conservative investors, it is safer to see if BCS can hold above 50-day MA of $18.31 before establishing the long-term position. Investors can consider adding position when MACD turns positive and RSI (14) starts to show a bullish lean. Currently, there is no ETF currently maintaining significant exposure to BCS.

Biogen Idec Inc.

Biogen was up 2.51% and closed at $166.06 on February 27, 2013. BIIB had been trading in the range of $115.03-$169.07 in the past 52 weeks. BIIB has a market cap of $39.29B with a low beta of 0.87.

On February 27, 2013, Canaccord Genuity upgraded BIIB from Hold to Buy with a price target of $187.00 (from $163.00). On February 8, 2013, Citi upgraded BIIB from Neutral to Buy with a price target of $187.00 (from $160.00). Analysts have a mean target price of $172.59 and a median target price of $170.00 for BIIB.

There are a few positive factors for BIIB:

  • Higher operating margin of 33.6% and net margin of 25.0% (vs. the industry average of 25.9% and 13.7%)
  • Stronger ROE of 20.6 (vs. the average of 13.5)
  • Lower debt/equity of 0.1 (vs. the average of 0.4)
  • Lower P/E of 28.1 and P/S of 5.5 (vs. the industry averages of 44.8 and 6.4)
  • BIIB generates an operating cash flow of $1.88B with a levered free cash flow of $1.44B

Technically, the MACD (12, 26, 9) indicator is showing a bearish trend. RSI (14) is picking up and indicating a strong bullish lean at 63.13. BIIB is currently trading above its 50-day MA of $153.21 and 200-day MA of $146.45, as seen from the chart below.

(click to enlarge)

Source: StockCharts.com

How to Invest

For bullish investors, a credit put spread of July 20, 2013 $140/$150 put can be reviewed. Investors can also review the following ETFs (with top 4 weighting) to gain exposure to BIIB:

  • Market Vectors Biotech ETF (NYSEARCA:BBH), 7.26% weighting
  • Nasdaq Biotechnology (NASDAQ:IBB), 5.15% weighting
  • Dynamic Biotech & Genome (NYSEARCA:PBE), 4.98% weighting
  • NYSE Arca Biotechnology Index Fund (NYSEARCA:FBT), 4.94% weighting

Note: All prices are quoted from the closing of February 27, 2013. Investors and traders are recommended to do their own due diligence and research before making any trading/investing decisions.

Source: 3 Stocks With Positive Upgrades And How To Invest