Motorola (MOT) shares are getting a boost from Bank of America/Merrill Lynch analyst Tai Liani, who this morning raised his rating on the stock to Buy from Neutral, setting a price target of $9, up from $7.

He cites four reasons for the upgrade, most of which boil down to a belief that the company is on the verge of staging a turnaround in its troubled handset business:

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Has solar demand–and the slide in solar shares–finally hit bottom?

The solar analysts at Merrill Lynch think so. In a piece authored by analysts Lu Yeung, Vincent Chow, Matthew Yates and Steve Millunovich, Merrill this morning asserts that “improving second derivative trends” suggest the industry is headed for a cyclical bottom.

The Merrill analysts assert that, while there is not likely to be a recovery in demand until early 2010, Q4 2008 and Q1 2009 “will mark the shipment bottom,” with modest sequential increases in subsequent quarters. “Our research suggests that some Asian vendors may forecast flat-to-rising shipments, suggesting inventory is peaking and depletion is underway, thanks to swift production cutbacks, signs of easing in solar project financing and solar ASP declines,” they write.

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Akamai (AKAM) shares are trading lower this morning after Merrill Lynch analyst Garrett Bekker cut his rating on the stock to Neutral from Buy. His price target drops to $15, from $16.

Bekker writes in a research note this morning that he expects “competitive challenges and spending headwinds to persist in 2009,” offsetting growing contributions from premium services and international expansion. He says the stock’s valuation appears reasonable, but that there are “few catalysts on the horizon.”

Bekkar also notes that he is concerned that growth in its e-commerce segment, which accounts or just over a quarter of revenue, could decelerate given eroding online spending trends.

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Nothing warns the heart of the Street more than a nice cost-cutting story.

Merrill Lynch analyst Raimo Lenschow this morning raised his rating on the German enterprise software giant SAP (SAP) to Buy from Neutral, upping his price target to $43.80 from $38.30, “predicated on the 2009 cost-saving story,” which he says the market isn’t getting. To reflect the increased belt-tightening, he upped his EPS estimates for the company to 2.11 Euros a share from 1.91 for 2009; for 2010, he goes to 2.31 Euros, from 2.21.

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It’s difficult to avoid the comparisons between the current sad state of financial affairs and the Great Depression. “This is not like 1987 or 1998 or 2001,” Merrill Lynch CEO John Thain said at a conference on Nov. 11. “We will in fact look back to the 1929 period to see the kind of slowdown we are seeing now.” Time depicted President-elect Barack Obama on its cover as Franklin Delano Roosevelt. And in Washington, the buzz is all about what the new team will do in its first 100 days. What’s next? Show trials in Moscow?

All this historically inaccurate nostalgia can occasionally make you want to clock somebody with one of the three volumes of Arthur M. Schlesinger Jr.’s history of the New Deal. The credit debacle of 2008 and the Great Depression may have similar origins: Both got going when financial crisis led to a reduction in consumer demand. But the two phenomena differ substantially.

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Numbers continue to ratchet lower for Dell (DELL) ahead of the company’s earnings report after the close Thursday for the fiscal third quarter ended October. While Hewlett-Packard’s (HPQ) preliminary results today impressed the Street, investors are more focused on the implications of recent ominous warnings from Intel (INTC) and others about the prospects for the rest of this year and 2009.

A number of analysts issued pre-earnings notes this morning and brought down numbers; these follow previous cautionary comments from analysts at Barclays, Merrill Lynch, Goldman, BMO Capital, Citigroup and Credit Suisse.

Cowen’s Louis Miscioscia today repeated his Outperform rating on the stock, but slashed his estimates. He now sees EPS of 31 cents for the October quarter, down from 34 cents; 30 cents for the January quarter, down from 35 cents; $1.30 for the January 2009 fiscal year, down from $1.39; and $1.25 for fiscal 2010, down from $1.49.

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So, Sun Microsystems (JAVA) finally caved in to Street pressure on Friday and announced plans to cut 5,000-6,000 jobs. But if you thought the move was going to ignite a new wave of love for the stock, you thought wrong.

The Street’s reaction boils down to two parts. One, it’s about time. The company tried to blame the cuts on the economy, but this is more about Sun’s own issues than what’s unfolding in the rest of the world. And two, it’s not going to be enough to fix the company. Here are a few samples of the current Street sentiment on Sun:

Merrill Lynch’s Jeff Fidacado today repeated his Underperform rating on the stock, asserting that it will take several quarters for margin improvements from the cost cuts to offset declining revenues. “Sun’s cost-reduction initiatives come at a time when revenue growth of its legacy high-end server platform is deteriorating and the most recently shipped innovative products are not large enough to offset this decline.”

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The news for videogame stocks is decidedly mixed this morning. The raw numbers look good: According to NPD Group, videogame software sales rose 35 percent in October, better than many had expected. Hardware sales rose five percent; peripherals fell eight percent.

But the stocks are coming under pressure, due at least in part to cautious comments on the prospects for the industry in the unfolding economic downturn by Merrill Lynch analyst Justin Post. The Merrill analyst cut his ratings on both Electronic Arts (ERTS) and Activision Blizzard (ATVI) to Neutral from Buy. He maintains his Underperform rating on THQ (THQI).

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Research In Motion (RIMM) turns out to be yet another company that simply can’t escape the clutches of the crumbling global economy.

Several analysts weighed in today with estimate cuts, pressuring the stock.

Merrill Lynch’s Vivek Arya cut this EPS estimate for the fiscal third quarter ended November to 80 cents from 95 cents, which is now below the Street at 92 cents. For the February 2009 fiscal year, he goes to $3.45, from $3.61, and for 2010, he goes to $4.08, from $4.45. Arya cited a number of factors for the downgrade, including macro headwinds, the late North American launch of both the Storm and the Bold, and increased competition from the Apple (AAPL) iPhone. He also notes that warnings from Best Buy, Circuit City and Intel suggest we are in for weak consumer demand in calendar Q4. “While smartphone demand would normally be more resilient due to carrier promotions and productivity benefits, the current environment demands caution,” he writes. His target price on the stock drops to $65, from $80.

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The hand-wringing on Cisco (CSCO) continues.

This morning, the Street churned out some more research filled with fretting over what CEO John Chambers is going to say tomorrow about the company’s prospects for growth in the January quarter and beyond. While the company has previously forecast growth for the January quarter in the 7.5 to 9.5 percent range, the Street is increasingly convinced that Cisco is going to bring numbers down. The question is how far down will they go – and how long will the downturn last.

Merrill Lynch analyst Tal Liani this morning said that the Street is looking for Cisco “to report weak results and provide weak guidance.” He notes that normally wide spread nervousness would be a good thing – but that this time around he remains cautious, and worries that “near-term trends could still be worse than expected.” Liani notes that demand for both high-end and low-end switches has weakened “considerably,” with growing price pressure.

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There’s troubling brewing at eBay (EBAY).
In a research note late yesterday, Merrill Lynch Internet analyst Justin Post said checks with the Professional eBay Sellers Association indicate that eBay’s gross merchandise value growth in the U.S. “turned negative” in September. Post says “channel checks remain troubling,” and that the slowdown reflects a demotion of eBay listings in Google (GOOG) search results as well as an influx of listings that are less attractive to buyers.

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Every cloud has a silver lining. Ask the cybersquatters. Even as the short-selling vultures began circling Lehman Brothers, HBOS, Merrill Lynch and company, a legion of entrepreneurs began betting on domain names for hastily merged financial institutions. For example, when Barclays and Bank of America began to emerge as buyers for Lehman, names such as barclayslehman.com and bofalehman.com were promptly registered by enterprising hopefuls.

Some of these domains were being offered for sale on eBay last week. For example, www.bankofamericamerrilllynch.com was available at a starting bid of $1,500. “With a deal between Bank of America and Merrill Lynch NOW ANNOUNCED,” burbled the seller, “this domain name will soon be incredibly popular. This is the only domain name that conveys the full picture, using the name of both firms. … This is the most comprehensive and commonsensical domain name available concerning the MERGER OF BANK OF AMERICA CORP AND MERRILL LYNCH & CO.” The last time your columnist checked, however, the auction had attracted no bidders. Still–nothing ventured, nothing gained.

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Merrill Lynch chip analyst Srini Pajjuri this morning cut his rating on Advanced Micro Devices (AMD) to Underperform from Neutral, while moving Analog Devices (ADI) in the other direction, to Neutral from Underperform.

Pajjuri notes that ADI is down nearly 30 percent since early June; he says the valuation now “mostly reflects our margin and growth concerns.” He notes that the stock trades at 12 times EV/FCF, a discount to other analog chip stocks. He points out that ADI boasts strong free cash flow and a three percent dividend yield, and that ADI has limited exposure to consumer and PC markets

As for AMD, Pajjuri says the change followed a review of his ratings following the call on ADI. “Although we have not changed our fundamental outlook for AMD, we believe it is relatively less attractive than other Neutral rated stocks in its cluster,” he writes.

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What do CEOs say to each other in private? Mean Street intercepted an (imaginary) email sent this morning by Merrill Lynch CEO John Thain to Sanjay Jha, newly appointed co-CEO of Motorola.

Dear Sanjay,

Many congratulations on your new job–and welcome to our ranks. It is a rare privilege to be CEO of a desperate company.

I’ve been at it now for almost nine months at Merrill Lynch, and I’ve learned a thing or two that you might find useful.

I hate to start on a sour note, but Monday’s announcement could have been handled better. Your arrival at Motorola was trumpeted a bit too loudly.

“A stunning win for Motorola,” cheered the Wall Street analysts. And your recruitment alone added more than $2 billion to the market value of Motorola.

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Merrill Lynch telecom equipment analyst Vivek Arya cut his rating on Nortel today to Underperform from Neutral, and cut his price target to $7 from $8.50. He says the move “is triggered by a combination of increased caution regarding Nortel’s 2009 prospects, as well as realignment of our coverage cluster related to our recent upgrade of Motorola.” Arya notes that the Street’s 2009 estimates are not supported by the company’s deteriorating trends in deferred revenues and new orders.

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