This Just In: Upgrades and Downgrades

At The Motley Fool, we poke plenty of fun at Wall Street analysts and their endless cycle of upgrades, downgrades, and "initiating coverage at neutral." So you might think we'd be the last people to give virtual ink to such "news." And we would be -- if that were all we were doing.

But in "This Just In," we don't simply tell you what the analysts said. We'll also show you whether they know what they're talking about. To help, we've enlisted Motley Fool CAPS, our tool for rating stocks and analysts alike. With CAPS, we'll be tracking the long-term performance of Wall Street's best and brightest -- and worst and sorriest, too.

And speaking of the best ...
No sooner had one investment banker, UBS, denigrated Delta Airlines (NYSE:DAL) as an overpriced underperformer yesterday morning, than out came another Swiss analyst, this time the eponymously named Credit Suisse, and upgraded Delta rival UAL Corp (NASDAQ:UAUA).

Said CS: "The recent sell-off in airline stocks discounts a more dire outlook than we believe justified." What's more, CS thinks United is "serious" (as opposed to just joking?) about cutting down on the number of flights it runs. And you know what they say about supply and demand -- cut the one, hold the other constant, and prices will take off. It gets a Fool to wondering -- what's with all the Swiss bankers playing good cop-bad cop on our airline industry? Delta's supposed to be overpriced, but United is cheap? Can both of these bankers be right?

Well, I've already contributed my $0.02 to the pot on UBS's Delta downgrade (read that here). Today, let's turn the pennies over and examine the flipside: CS's upgrade of United. Sure, this banker loves to fly (and it shows), but does it exhibit any skill at the stock throttle?

Let's go to the tape
Actually, yes, it does. Our analyst-tracking radar on CAPS shows that when it comes to picking winning stocks, CS actually flies circles around its fellow countrymen at UBS, scoring a 93.27 rating to UBS's 90.92. The bank has been particularly successful with picks like:

Unfortunately -- and much as I'd like to reassure UAL investors to the contrary -- CS's record on airline stocks in particular is mixed:

Foolish takeaway
So which is it? Is Credit Suisse the stock-picking genius pictured in the first table above, or the apparent coin-flipping dilettante reflected in the second? Perhaps both. Perhaps neither. All I know for sure is that Warren Buffett says:

"I have an 800 number now that I call if I get the urge to buy an airline stock. I call at two in the morning and I say: 'My name is Warren and I'm an aeroholic.' And then they talk me down." That's good enough to keep yours Fool-y from investing in the industry, no matter how smart the analyst saying that I should.

If you're dead set on investing in UAL, however, and are just waiting for a second opinion before pulling the trigger, I won't try to talk you out of it. Instead, I'll point you toward the CAPS player with the single best record on UAL, to see what he has to say about the stock. Click here to flag him down.

Fool contributor Rich Smith does not own shares of any company named above. You can find him on CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked No. 530 out of more than 28,000 raters. The Fool has a disclosure policy.