Corinthian Colleges (COCO ): Reiterates 5 STARS (buy)

Analyst: Michael Jaffe

Trading in Corinthian was halted earlier after shares plunged 33% Friday. The shares have mostly recovered since Corinthian said it knows of no event to warrant a sell-off. But nervousness surrounds shares of for-profit educators after two recent media reports on allegations that Career Education (CECO ) falsified student records. S&P remains positive on Corinthian as rising worker ambition drives education demand and as the company expands via a solid takeover program and campus openings. At 22 times S&P's fiscal 2005 (June) earnings per share estimate, S&P sees Corinthian as attractive at 0.9 times the price-earnings-to-growth ratio.

General Electric (GE ): Reiterates3 STARS (hold)

Analyst: Robert Friedman

S&P is a bit skeptical about GE's announcement that it will bundle several of its industrial/consumer units. S&P's take is that GE's segment reporting disclosure will become less transparent. Moreover, S&P thinks GE's latest moves are little more than cosmetic; thus, they won't resolve the company's biggest challenge, which is the ability to generate long-term 10%-plus free cash growth and a 15%-plus debt-adjusted return on equity, given its enormous revenue and capital base. S&P's discounted cash-flow-based 12-month target price continues to value GE shares at about $30.

JetBlue Airways (JBLU ): Reiterates 3 STARS (hold)

Analyst: James Corridore

Low-cost carrier JetBlue's shares fell 17% early Friday on news it now expects margins to contract in the fourth quarter on price pressures on airfares. JetBlue is apparently seeing weaker holiday demand than S&P was expecting, a situation that's likely to affect most other carriers. S&P expects travel demand to strengthen in 2004 and beyond and is still positive on the JetBlue story, since S&P sees strong revenue growth opportunities at an attractive margin for some time to come. However, given the weaker-than-expected revenue outlook, S&P would not add to positions.

Harley-Davidson (HDI ): Maintains 3 STARS (hold)

Analyst: Thomas Graves

S&P is pleased to see motorcycle maker Harley-Davidson doubling its quarterly dividend to 8 cents per share. However, the indicated yield is only 0.7% at the new level. At the end of its third quarter, Harley-Davidson had cash or short-term equivalents totaling $942 million, or about $3.11 per share. S&P sees the stock's recently weak performance vs. the S&P 500 as being partly due to guidance disappointment in mid-October on production capacity and financial services profit for 2004. S&P is keeping the 2003 earnings per share estimate at $2.47 and raising its 2004 estimate to $2.68, from $2.66. S&P also is keeping the 12-month target price of $54.

Intel (INTC ): Reiterates 5 STARS (buy)

Analyst: Thomas Smith

The bellwether chipmaker's mid-quarter update improves revenue guidance to the $8.5 to $8.7 billion range, from the prior $8.1 to $8.7 billion range. More importantly, in S&P's view, is Intel's mid-point guidance for gross margin improvement to 62%, from 60%. Excluding the effect of a $600 million, or 6 cents per share, fourth-quarter charge for goodwill impairment in the communications segment, S&P is raising its 2003 earnings per share estimate to 83 cents, from 81 cents, and is upping the 2004 estimate to $1.20, from $1.10. S&P also is hiking its 12-month target price to $45, from $42, based in part on applying the price-earnings of 28, which is based on S&P's 2004 estimate, to S&P's $1.60 estimate for 2005.

Citigroup (C ): Maintains 5 STARS (buy)

Analyst: Mark Morgan

S&P is adjusting its estimates higher to reflect expectations of improving credit quality in Citigroup's commercial and consumer credit businesses, and slightly higher capital markets activity. S&P's new 2003 earnings per share estimate is $3.44, raised from $3.40, and 2004's estimate is $3.87, raised from $3.80. S&P thinks Citigroup's mix of high-growth consumer businesses, combined with improving corporate lending and investment banking markets, should accelerate earnings growth through 2004. S&P's 12-month target price remains $57, which is 14.7 times the 2004 estimate, in line with Citigroup's historical average.

IBM Corp. (IBM ): Reiterates 5 STARS (buy)

Analyst: Megan Graham-Hackett

At the company's fall analyst meeting, IBM stated that it's now focused on revenue growth. IBM plans to focus on internal investments, but says it could make another $5 billion in acquisitions if attractive opportunities arise. The company also reiterated that it's well-positioned for the information-technology upturn, given its broad solutions offerings and deep industry knowledge, and S&P concurs with this assessment. S&P is keeping the 12-month target price and earnings per share estimates, but notes IBM cited signs of better customer spending.

U.S. Steel (X ) and AK Steel (AKS ): Maintains 3 STARS (hold); Nucor (NUE ): Reiterates 5 STARS (buy)

Analyst: Leo Larkin, James Sanders

President Bush announced Thursday that tariffs on imported steel would be lifted. Near term, S&P believes this action will lead to further consolidation of a domestic steel industry that's rife with financially weak companies. However, longer term, S&P anticipates that a much more concentrated group of companies will likely emerge that should be able to more effectively compete in the global steel market.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE