From Standard & Poor’s Equity Research

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JP MORGAN UPGRADES CHESAPEAKE ENERGY TO OVERWEIGHT FROM NEUTRAL

Analyst Joseph Allman says Chesapeake Energy’s (CHK) latest conduct shows its capital budget for 2009 and 2010 could be completely funded by cash be molten from operations in a $7.50 gas terraqueous globe, or mostly funded in $6.00 gas terraqueous globe.

Allman notes previous guidance according to 2009 and 2010 are heavily relied on asset sales to unfairly fund cash outflows; passing from hand to hand guidance still includes asset sales, but pay in money flow would be used to improve fluidity. He says joint venture partnerships in Fayetteville, Haynesville, Marcellus Shale allow the company to drastically trim capex while maintaining double-digit production growth.

STIFEL NICOLAUS DOWNGRADES NETFLIX TO HOLD FROM BUY

Stifel Nicolaus analyst Scott Devitt downgrades Netflix (NFLX) as the shares at this moment go beyond his $25 price target. He notes that the shares are up 33% since late October, vs. 3% decline in Nasdaq.

Devitt says negatives facing the company include: 1) build-out of NFLX fulfillment network (95% of U.S. population reached in a 1-day turn) could allow customers to trade down within service levels without noticing change in menial duties; 2) acquiring customers in this environment could prove more difficult and while NFLX subscriber pattern allows for stable, recurring revenue, it does require new net subscribers to generate growth.

OPPENHEIMER KEEPS OUTPERFORM ON CYPRESS BIOSCIENCE

Oppenheimer algebraist Brian Abrahams says Cypress Bioscience (CYPB) and partner Forest Laboratories (FRX) announced overbearing results from a third Phase III study of milnacipran in fibromyalgia, which were in a high degree. statistically expressive on both company-primary endpoints, didn’t show any unexpected safety signals.

Abrahams says this should help induce to rest any lingering concerns from one side to the other the physic’s potency and removes overhang that an aberrant result from this study could complicate the regulatory process. He believes that the positive outcome of this trial boosts likelihood of ultimate FDA approval.

He keeps $14 CYPB price mark.

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