KeyBanc Bullish on TRW Automotive (NYSE:TRW), Autoliv (NYSE:ALV), ArvinMeritor (NYSE:ARM), Dana Holding (NYSE:DAN), Lear (NYSE:LEA), Stoneridge Inc. (NYSE:SRI), Tenneco (NYSE:TEN)

KeyBanc is bullish on the automotive and commercial vehicle markets heading into 2011, and they like TRW Automotive (NYSE:TRW), Autoliv (NYSE:ALV), ArvinMeritor (NYSE:ARM), Dana Holding (NYSE:DAN), Lear (NYSE:LEA), Stoneridge Inc. (NYSE:SRI) and Tenneco (NYSE:TEN) in the sector.

KeyBanc said, "Heading into 2011, we have increased confidence in the ongoing recovery in both the automotive and commercial vehicle markets and believe that select stocks with exposure to those verticals are likely to continue to outperform. As such: 1) we are upgrading our rating on shares of TRW Automotive to BUY from HOLD and establishing a $69 price target; 2) we are raising our price targets on Autoliv Inc. to $92 from $76, ArvinMeritor, Inc. to $29 from $25, Dana Holding Corporation to $20 from $17, Lear Corporation to $127 from $104, Stoneridge, Inc. to $19 from $16, and Tenneco Automotive Inc. to $55 from $40; 3) we are raising our 2010 and 2011 automotive and commercial vehicle forecasts and introducing a 2012 forecast; and 4) we are raising 2010 and 2011 earnings estimates accordingly. Our top picks are ARM (#1), TEN (#2), LEA (#3), TRW (#4), and for small cap investors SRI."

TRW Automotive closed Tuesday at $53.03, up $0.40, or 0.76 percent. Autoliv, Inc. closed at $78.73, up $0.41, or 0.52 percent. ArvinMeritor ended at $19.97, up $0.68, or 3.53 percent. Dana Holding was up to $17.05, increasing $0.59, or 3.58 percent. Stoneridge Inc. closed at $15.85, up $0.54, or 3.53 percent. Tenneco ended at $41.22, up 1.11, or 2.77 percent.