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 ...
All I've got to say is: "Way to end the week in style, Credit Suisse."

As markets wound down the trading week ahead of a three-day weekend Friday, the sly Swiss stockpicker snuck in one last upgrade -- and boy, was it ever a doozy. Taking inspiration from Rio Tinto's (NYSE:RTP) boffo fourth-quarter report, Credit Suisse upgraded the Australian ore-miner's shares for the second time in as many weeks, and advised investors to buy into the momentum.

Is that good advice?

Let's go to the tape
On the face of it, I'm certainly inclined to give Credit Suisse a listen on this one. After all, three years of tracking this analyst's hundreds of upgrades and downgrades has proven Credit Suisse to be one astute banker. When CS says a stock is destined to outperform the market, more often than not, it does just that:

Companies

CS Says:

CAPS says:

CS's Picks Beating S&P By:

Freeport-McMoRan Copper (NYSE:FCX)

Outperform

****

49 points

BHP Billiton (NYSE:BHP)

Underperform

****

45 points (two picks)  

Barrick Gold (NYSE:ABX)

Outperform

***

17 points (two picks)

CS's success with mining stocks has helped the analyst rise to the top ranks of investors tracked by CAPS -- that rarefied sphere we label the "CAPS All-Stars." And yet, no one's infallible, and CS has made more than a few stumbles along the way:

Companies

CS Says:

CAPS says:

CS's Picks Lagging S&P By:

Yamana Gold (NYSE:AUY)

Outperform

***

15 points

Alcoa (NYSE:AA)

Outperform

****

38 points

Southern Copper (NYSE:PCU)

Underperform

****

51 points

Digging into the numbers
So will Credit Suisse's double-upgrade of Rio Tinto perform as well as its brilliant endorsement of Freeport-McMoRan -- or join Southern Copper in the losers column? Recent news items suggest the former (but as you'll see in a moment, I actually fear the latter.)

On the plus side for Credit Suisse, Rio Tinto did just strike gold with its Q4 earnings release. Among the highlights, Rio reported cutting its debt in half last year, while reducing its operating costs by a staggering $2.6 billion. The company's aluminum business swung back to a profit, and things look even better for iron -- where the Wall Street Journal is now reporting that iron ore prices could spike as much as 40% for 2010 on the back of new negotiations with Chinese buyers.

All of this has analysts positing years of growth for Rio Tinto. Consensus targets now suggest the company's profits could rise as much as 145% from 2009, peaking at $6.89 per share in 2013.

But here's the thing: Those profits may not be all their cracked up to be.

There's profit, and then there's cash profit
You see, Rio Tinto reported earning $4.9 billion in "profits" last year. Problem is, only 70% of that figure ($3.8 billion) appeared on Rio's cash flow statement in the form of free cash flow. Nor is this a recent, short-term phenomenon. To the contrary, over the past five years Rio's results have been significantly weaker than what we saw last week, with free cash flow backing up less than 70% of the company's "net earnings."

Foolish takeaway
And don't expect matters to improve any time soon, either. In fact, with Rio Tinto promising to raise capital spending by more than 11% in fiscal 2010, and a recovery in the global economy (and global iron-demand) still far from certain, I'm not convinced that Rio will even be able to maintain last year's free cash flow performance in the current year.

My advice: Mind the free cash flow gap, folks. This stock may be a deeper hole than you think.

Fool contributor Rich Smith has no position in any of the stocks named above. The Motley Fool's disclosure policy will happily trade its mining pickaxe for a sturdy snow shovel.