Top 3 Stock Upgrades On September 7

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Includes: CF, GMCR, MAR
by: Jorge Aura

Speculating with companies that have recently changed their ratings can be a good short-term strategy. Normally, companies will see increases in their prices after these changes.

I assessed companies which have been upgraded on September 7. I chose the top three companies with a significant change on ratings. Here is a look at the three stocks:

1. CF Industries (NYSE:CF) is a global leader in fertilizer manufacturing and distribution, the second largest nitrogen fertilizer producer in the world and the third largest phosphate fertilizer producer among public companies. Its common stock is traded on the New York Stock Exchange. CF Industries owns and operates world-scale nitrogen and phosphate plants and serves agricultural and industrial customers through its best-in-class distribution system.

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- The MACD mark change of upward trend. RSI in good point. The stock goes above the bullish channel.

New Rating

Feltl & Co upgraded CF Industries from Buy to Strong Buy.

Consensus Recommendation

(SOURCE)

Financials

The company reported the second-quarter financial results on August 8 with the following highlights:

Revenue $1.73 Billion
Net Income $678 Million
Cash $1.2 Billion
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Short Interest

Settlement Date Short Interest Avg Daily Share Volume Days To Cover
8/15/2012 1,686,569 1,427,115 1.181803
7/31/2012 1,528,589 1,343,265 1.137965
7/13/2012 1,728,572 1,175,336 1.470705
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My Analysis

The stock has a $220 price target from the Point and Figure chart. The latest insider buy transaction was in November 2011. The stock is trading at a forward P/E of 8.20. The short interest shows no significant changes. The stock is just $3.28 shy of the $218.25 52 weeks high. I believe the $218 price target is achievable during the next 6-12 months.

2. Starwood Hotels & Resorts Worldwide Inc. (HOT) operates as a hotel and leisure company worldwide. The company operates luxury and upscale full service hotels, select-service hotels, extended stay hotels, resorts, retreats, and residences under St. Regis, The Luxury Collection, W, Westin, Le Méridien, Sheraton, Four Points, Aloft, and Element brand names. It is portfolio consisted of 1,112 properties in approximately 100 countries.

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- The MACD and RSI follow a Bullish trend.

New Rating

Argus upgraded Starwood Hotels & Resorts from Hold to Buy.

Consensus Recommendation

(SOURCE)

Financials

The company reported the second-quarter financial results on July 26 with the following highlights:

Revenue $453 Million
Net Income $122 Million
Cash $270 Million
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Short Interest

Settlement Date Short Interest Avg Daily Share Volume Days To Cover
8/15/2012 4,586,846 1,815,493 2.526502
7/31/2012 4,870,997 2,786,924 1.747804
7/13/2012 4,010,188 2,896,956 1.384276
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My analysis

The stock has a $60.81 price target from the Point and Figure chart. Starwood Hotels & Resorts Worldwide Inc. has little insider selling this year. The stock is trading at a forward P/E of 19.55. I would buy a small position because the stock is bullish and the recent recommendation "upgrade" will help overcome the $60.81 target price.

3. Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) engages in the specialty coffee and coffee maker business. The company sources, produces, and sells approximately 200 varieties of coffee, cocoa, teas, and other beverages in K-Cup portion packs and coffee in traditional packaging, including whole bean and ground coffee selections in bags and ground coffee in fractional packs for use in at-home (AH) and away-from-home (NASDAQ:AFH). Its common stock is traded on the Nasdaq market.

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- The MACD mark a change of upward trend. the stock goes inside the bullish channel

New Rating

Lazard Capital started coverage with a Buy rating and very shareholder-friendly price target of $39.

Consensus Recommendation

(SOURCE)

Financials

The company reported the second-quarter financial results on August 1 with the following highlights:

Revenue $869 Million
Net Income $73 Million
Cash $139 Million
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Short Interest

Settlement Date Short Interest Avg Daily Share Volume Days To Cover
8/15/2012 40,037,307 10,874,830 3.681649
7/31/2012 35,092,330 6,505,379 5.394356
7/13/2012 29,596,972 6,579,810

4.498150

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My analysis

The stock has a $35 price target from the Point and Figure chart. The short interest has increased significantly in a month. The latest insider buy transaction was in August 31. Although the short interest has increased, the insiders have purchased shares recently. I recommend buy shares with a price target of $35 for sale in the short term. Any positive news from the company can make a massive closing of short positions.

*Chart data sourced from stockcharts, all other data sourced from Nasdaq.com as well as the web of the previously mentioned company.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: Investors buy and/or sell at their own risk. I declare that I may day-trade any stock at any time mentioned in this article. For me "long" is until I sell and few tell you that. I do not "short" stocks and few tell you that too. I also get paid one penny per view from SA and other than being published by SA and my own private stock account, I have zero connection to Wall Street and few tell you that too.