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 track the long-term performance of Wall Street's best and brightest -- and its worst and sorriest, too.

And speaking of the best ...
With still a week to go before earnings, shareholders of Priceline.com (NASDAQ:PCLN) are already cheering. The reason: Susquehanna International upgraded the stock to "positive" yesterday, arguing that fears of a strong dollar hobbling earnings at the "name your own price" specialist are overblown.

Quoth the analyst: "[Priceline.com] likely outperformed expectations for 4Q09" (setting us up for an "earnings beat" next week). Going forward, Susquehanna sees Priceline's "highly variable cost structure" limiting the downside even if euro-denominated revenues shrink after being translated back into U.S. dollar-denominated profits back home. Susquehanna is therefore "nudging our EPS higher" and turning "positive" on the shares.

But should you follow suit?

Let's go to the tape
Perhaps. After all, Susquehanna has done great with past picks in the Internet and Catalog Retail sector, scoring 80% for accuracy on past recommendations of Amazon.com (NASDAQ:AMZN), Blue Nile (NASDAQ:NILE), and ... Priceline.com itself.

Problem is, Susquehanna has a pretty rotten record on Hotels, Restaurants and Leisure stocks -- the places that customers actually go after going to Priceline to score a bargain:

Companies

Susquehanna Says:

CAPS Says:

Susquehanna's Picks Beating
(Lagging) S&P By:

Ctrip.com (NASDAQ:CTRP)

Outperform

****

14 points

Wynn Resorts (NASDAQ:WYNN)

Outperform

*

(34 points)

Las Vegas Sands (NYSE:LVS)

Outperform

**

(55 points)

MGM Mirage (NYSE:MGM)

Underperform

**

(82 points) (two picks)

With a record of just 40% accuracy in this sector, the risk is that even if Susquehanna has a handle on the economics of Internet stocks, its grasp of the bigger economic picture in general, and the demand side of the vacation travel equation in particular, isn't quite as firm. And the longer the economy remains weak, and potential travelers are unemployed and financially incapable of vacationing, the more important this risk will become.

Buy the numbers?
So which way's a Fool to lean on this one? Do we trust Susquehanna's judgment based on its admirable record specifically in Internet stocks, or avoid the recommendation based on its iffier performance elsewhere?

Personally, I'm inclined to go with Susquehanna's judgment on this one -- mostly because my own experience convinces me that Priceline can execute whatever the economic environment. But also because ... the price looks nice. Selling for 21 times trailing earnings, and a price-to-free cash flow multiple that's not much worse, Priceline looks at worst fairly valued to me based on analyst consensus estimates of 21% five-year growth. (The fact that Priceline has beaten these estimates every single quarter for the past three-and-a-half years doesn't hurt.)

That said, if you're leery of investing in Priceline today ... well, I can't blame you. Consider: Twenty-one percent growth looks plenty strong to justify a multiple of 21 on the stock. But in the course of issuing its own upgrade, Susquehanna may have hit upon a cause for worry as well -- warning that "current currency rates could subtract about 3 points from growth in 2010."

If that's the way things play out this year, and if the dollar remains strong over the long term, that could put a dent in investor expectations of 21% growth.

Foolish takeaway
So hypothetically, let's say Susquehanna is right and Priceline does beat earnings (again) next week. Let's further assume that the earnings beat causes the price to pop, perhaps to a higher multiple. Last but not least, let's hypothesize a three-percentage-point drop in long-term growth to 17%. In that case, I'd say it would be time to reevaluate whether Priceline has gotten too pricey to own.

So what's a Fool to do between now and earnings day? I'll give you the same advice that Priceline.com gives us all every day of the week: Go ahead and buy -- just be careful not to overpay.

Fool contributor Rich Smith has no position in any of the stocks named above, but Blue Nile is a Motley Fool Rule Breakers selection, Amazon.com and Priceline.com are Motley Fool Stock Advisor picks, and Ctrip.com International is a Motley Fool Hidden Gems recommendation. You can find Rich on CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked No. 635 out of more than 150,000 members. The Motley Fool has a disclosure policy.