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 its worst and sorriest, too.

And speaking of the best ...
It's common for a stock on the receiving end of an "analyst upgrade" to receive a short-term bounce as investors take that analyst's advice to heart -- or buy in anticipation that others will. Less commonly, the stock will hold on to the bumped-up price. Rarer still, investors take the analyst's endorsement as some kind of contrarian indicator and sell on the news.

Yesterday, we saw all three scenarios play out, as investors learned that Bear Stearns was doing a 180 on space-based radio operator Sirius Satellite Radio (NASDAQ:SIRI) by changing its rating from "underperform" to "outperform." Investors first jumped on the Bear Sterns wagon and then took all their money off the table -- and more. They sold the stock off by a penny before finally relenting and letting Sirius keep one cent's worth of gains for the day.

Getting back to the source of all the commotion, Bear argued yesterday that Sirius presents investors with a win-win situation. If Sirius' proposed merger with arch-nemesis XM Satellite Radio (NASDAQ:XMSR) passes muster with government regulators, it would permit the merged firm to reap "synergies" from cost-cutting and elimination of near-duplicate channels. (For the record, Bear believes that "the merger closing probability is higher than market sentiment.") On the other hand, Bear thinks that "investors can still [buy Sirius] assuming the merger fails," on the basis of Sirius' own independent merit.

The decision
Before deciding whether to heed Bear's advice and buy shares of Sirius, come what may, investors owe it to themselves to do a little due diligence -- not just on Sirius itself, but also on the record of the firm that's recommending Sirius. Just how likely is it that Bear has "called the bottom" on this stock that, to date, has underperformed the S&P by more than 56 percentage points over the past 52 weeks?

Let's go to the tape
For clues to Bear's prescience, we turn once again to CAPS, where we've been following Bear's tracks for nearly a year. There we see that Bear has come out of hibernation since we last checked in. Scoring in just the 76th percentile of CAPS players in May, Bear's ranking stands today at a more than respectable 85.05 -- good enough to earn the firm All-Star status. A few of the picks that have helped to wake Bear up include:

Company

Bear Says:

CAPS Says (out of 5)

Bear's Pick Beating S&P By:

MasterCard (NYSE:MA)

Outperform

***

5 points

Quintana Maritime (NASDAQ:QMAR)

Outperform

****

1 point

Yet the firm has actually made as many wrong calls as right since our column ran in May. Picks like these:

Company

Bear Says:

CAPS Says:

Bear's Pick Lagging S&P By:

MetroPCS (NYSE:PCS)

Outperform

***

1 point

Tiffany (NYSE:TIF)

Outperform

****

2 points

So what gives? How does a 50/50 win/loss record translate into nearly 9 points of improvement in Bear's CAPS rating? There can be only one explanation: Some of the firm's past recommendations just needed a bit more time to "season" -- time for Bear's bearish, or more often bullish, theses to play out in full. Over time, as the firm proved itself prescient, the CAPS points took care of themselves.

Will Bear's endorsement of Sirius work out similarly? Will it wilt in the summer heat, only to bloom anew months down the road? Perhaps. I must admit that I see little attraction in the money-losing, cash-burning Sirius -- at least today. But months or years down the road, if a lack of competition allows a combined XM-Sirius to raise its rates (and profit margins) -- or even if the merger is quashed and Sirius and XM call a truce, scale back on their advertising spending, and agree to live separately but in harmony -- then it's entirely possible that Bear will be proved right.

Seeking a more-bearish-than-Bear opinion on Sirius? You need look no further than the top-scoring CAPS player of all time, TMFEldrehad -- who is also the top-scoring rater on Sirius. Learn what he thinks of satellite radio's future when you visit his CAPS page.

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. 758 out of more than 29,000 rated players. MasterCard is an Inside Value newsletter recommendation. The Motley Fool has a disclosure policy.