Downgrades: Jefferies downgrades VCA Antech (WOOF 30.92) to Underperform from Buy and lowers their tgt to $25 from $35 saying they believe reduced consumer spending and rising unemployment levels will dampen WOOF's hospital and lab volumes in FY09. Given this expectation and barring any unforeseen near-term economic recovery, the firm expects WOOF shares to be under pressure.... SunTrust downgrades Armstrong World Industries (AWI 30.04) to Neutral from Buy, based on prospects for a a lower special dividend than discussed earlier in the year, the firm's lowered view of commercial construction spending in both U.S. and Europe for both new and renovation markets, expectations of continued losses in European flooring business in 2009, and their view that 2010 earnings will most likely be below '09 earnings. Miscellaneous: Jesup & Lamont initiates Tidewater (TDW 52.05) with a Buy and price target of $110 saying they fully expect, TDW to continue to grow through both accretive acquisitions and increased newbuild spending over the next few years... Morgan Stanley initiates Smith & Nephew (SNN 51.55) with an Equal-weight... Roth initiates Zumiez (ZUMZ 16.53) with a Hold and sets a $15 tgt, based on a challenging macro environment, tough comparisons and brand dilution... Roth initiates Clinical Data (CLDA 15.80) with a Buy and sets a $21 tgt, based on the efficacy of Viladozone that has been clinically demonstrated to be strongly correlated with the presence of a testable genetic marker and expect positive Ph. 3 results within the year... Baird initiates Cousins Properties (CUZ 23.50) with a Neutral and sets a $25 tgt, based on negative near-term fundamental outlooks for the office, retail, and residential development businesses, though positively offset by current valuation... Baird initiates Digital Realty Trust (DLR 44.40) with an Outperform and sets a $50 tgt, based on strong demand that lays the groundwork for a burgeoning industry, steady, robust FFO growth that drives a premium valuation, and a solid development pipeline which initiates growth.
Downgrades: Oppenheimer downgrades Total System Services (TSS 15.28) to Perform from Outperform, based on national and regional bank consolidation actions and fears, the associated risks to TSS's customer portfolio and the generally more difficult macro environment... Keefe, Bruyette downgrades NYMAGIC (NYM 27.37) to Underperform from Market Perform and raises their tgt to $20 from $15, based on valuation, pre-announced investment/Gustav losses and estimates of additional mark-to-market losses, weaker investment returns, and Ike losses... Baird downgrades Gentex (GNTX 15.19) to Neutral from Outperform and lowers their tgt to $16 from $18, following Q3 revenue growth guidance that was lowered to 5% year/year drop from 10% increase... Baird downgrades Littlefuse (LFUS 30.26) to Neutral from Outperform and lowers their tgt to $33 from $42, following lowered Q308 revenue and EPS guidance due to weakness in the automotive and electronic markets... Baird downgrades Fifth Third (FITB 9.11) to Neutral from Outperform and lowers their tgt to $12 from $16, as they believe the co's higher-risk loan book could result in the need for additional capital as the co deals with outsized credit costs in its construction and home builder loan portfolios... Deutsche Bank downgrades ChipMos Technologies (IMOS 1.70) to Hold from Buy.
Upgrades: Wachovia upgrades Landstar LSTR 42.30) to Outperform from Market Perform... Baird upgrades Emerson Electric (EMR 38.46) to Outperform from Neutral and maintains their $49 tgt, based on valuation and estimate EPS can remain above $3.00 through 2010, even in the event of a global recession, and see limited downside to shares at $38... Baird upgrades Baldor Electric (BEZ 26.29) to Outperform from Neutral and lowers their tgt to $33 from $35, based on valuation... Baird upgrades Airgas (ARG 44.35) to Outperform from Neutral and maintains their $68 tgt, based on valuation, growth and margin drivers that include additional price increases effective August 1, acquisition integration benefit plus additional cost savings, and structural positives including higher-margin gas and rent revenues that have never been negative y/y and 40% of revenues from higher-growth strategic product sales... Baird upgrades Wells Fargo (WFC 33.25) to Neutral from Underperform and raises their tgt to $35 from $25, as they believe WFC will likely be able to generate meaningful revenue growth, which should drive above-average revenue and earnings growth and enable the co to earn through the credit cycle... Piper Jaffray upgrades Intel (INTC 17.27) to Buy from Neutral... Friedman Billings upgrades Abercrombie & Fitch (ANF 35.74) to Outperform from Market Perform and lowers their tgt to $45 from $51, as they believe earnings are still at risk yet feel shares reflect a worse case scenario with regard to FY09 earnings, and that before, the co would see those type of estimates, management would certainly do something to right the business.
Barrington downgrades WAG to Mkt Perform from Outperform following WAG's Q4 earnings report. The firm notes that EPS of $0.45 per share was below their estimate of $0.46. Firm says while reported EPS met the consensus, quality of earnings was low, reflecting benefits of a lower tax rate and a one-time vacation accrual adjustment. Firm also notes that while overall SG&A spending remains under tight control, mgmt acknowledged that certain promotional investments failed to yield any sales benefit in the quarter, leading to further margin erosion.
Upgrades: KeyBanc upgrades BorgWarner (BWA 32.46) to Buy from Hold and sets a $46 tgt, as they believe that robust demand for the co's products will continue to drive revenue growth and margin expansion, resulting in double-digit EPS growth... Oppenheimer upgrades National City (NCC 3.71) to Outperform from Perform and sets a $5 tgt, based on valuation and believe the bank isn't seeing a mass exodus of despositors while their loan portfolio is more diversified and better quality than WaMu's... UBS upgrades Nortel (NT 2.54) to Buy from Neutral... Wachovia upgrades Brookfield Infrastructure Partners LP (BIP 15.40) to Outperform from Market Perform... Piper Jaffray upgrades Xilinx (XLNX 23.98) to Buy from Neutral... J.P Morgan upgrades Telesp Part Adr (TSP 23.90) to Neutral from Underweight. Downgrades: Morgan Stanley downgrades Apple (AAPL 128.24) to Equal Weight from Overweight... RBC downgrades Apple (AAPL 128.24) to Sector Perform from Outperform. Miscellaneous: Oppenheimer initiates China Mass Media Int'l Advertising (CMM 4.92) with an Outperform and sets an $8.50 tgt, based on a proven attractive partner to China's dominant TV network, China's ad market that is large and fast growing, and expansion into commercial production that creates a potential growth opportunity.
Downgrades: Merriman downgrades Bankrate (RATE 39.12) to Neutral from Buy, based on concerns about display advertising trends industry-wide, the co's above-average exposure to the financial vertical, and shares that trade in-line with peers... Merriman downgrades TheStreet.com (TSCM 6.01) to Neutral from Buy, as they believe near-term expectations appear relatively safe but FY09 could be at risk... Baird downgrades Monaco Coach (MNC 2.30) to Neutral from Outperform, Thor Industries (THO 26.80) to Underperform from Neutral, and Winnebago Industries (WGO 13.85) to Underperform from Neutral, based on valuation and checks that suggest fundamentals remain dreadful, including weak demand, failing dealers/manufacturers, tighter credit, and no appetite for inventory... Credit Suisse downgrades DigitalRiver (DRIV 36.03) to Neutral from Outperform... JP Morgan downgrades Arch Capital (ACGL 73.40) to Neutral from Overweight... Deutsche Bank downgrades DISH Network (DISH 24.55) to Hold from Buy and lowers their tgt to $31 from $51, following news that AT&T won't be renewing its five-year partnership with DISH, instead choosing to partner with DirecTV... Citigroup downgrades Starwood Hotels & Resorts (HOT 30.27), Sunstone Hotel Investors (SHO 14.04) and Host Hotels & Resorts (HST 13.95) to Hold from Buy, as they feel tighter credit could result in a more difficult economic environment for the cos than previously anticipated... Citigroup downgrades Strategic Hotels & Resorts (BEE 9.00) to Sell from Hold and lowers their tgt to $6 from $9, based on valuation, balance sheet leverage that is high, and a possible dividend reduction next year. Citigroup downgrades Sadia (SDA 9.50) to Sell from Buy.
Upgrades: Merrill upgrades Assurant (AIZ 51.30) to Buy from Neutral. Downgrades: Jefferies downgrades Mentor (MNT 26.99) to Hold from Buy and cuts their tgt to $31 from $36 saying while they think that MNT's current share price underestimates its long-term value as a one of two key players in the breast implant market and pipeline (PurTox), near-term economic conditions and the prospect of lowered guidance drive their ratings change. Miscellaneous: Piper Jaffray initiates Calgon Carbon (CCC 20.86) with a Neutral and a $23 tgt... Piper Jaffray initiates Pentair (PNR 38.74) with a Neutral... Piper Jaffray initiates Lindsay Manufacturing (LNN 73.01) with a Buy.
Upgrades: Credit Suisse upgrades Research in Motion (RIMM 97.53) to Neutral from Underperform and cut their tgt to $80 from $100 following the co's Q2 results. The firm says given that their margin concerns (now evident), are likely to force Street numbers toward their already below consensus estimates, they are upgrading the stock. The firm says concerns over volume growth slowdown remain, and valuation is reasonable, but too early to buy. Downgrades: Citigroup downgrades CF Industries (CF 110.20) to Hold from Buy... Citigroup downgrades Agrium (AGU 74.85) to Hold from Buy... Citigroup downgrades Terra Industries (TRA 37.90) to Hold from Buy... Merrill Lynch downgrades Torchmark (TMK 62.14) to Neutral from Buy... Merrill Lynch downgrades PACCAR (PCAR 39.70) to Neutral from Buy... Credit Suisse downgrades Canon (CAJ 40.11) to Neutral from Outperform... Deutsche Bank downgrades Research In Motion (RIMM 97.53) to Sell from Hold.
Miscellaneous: Caris initiates AngioDynamics (ANGO 16.64) with a Buy and sets a $20 tgt, as they believe the current $204 mln FY09 consensus revenue forecast is conservative, and doesn't adequately account for contributions from the acquired Diomed business (firm forecast $19 mln) or 28 new sales reps to be added 1H09 (firm forecast $25 mln)... SunTrust initiates IDEXX Laboratories (IDXX 57.55) with a Neutral, based on organic revenue growth that has decelerated to low-double-digits with the three main Companion Animal Group business units reporting less than 11% organic revenue growth in Q208, shares trading at a slight premium to its historic NTM P/E multiple, and a slowing lab business... Baird initiates Ecolab (ECL 49.42) with a Neutral and sets a $54 tgt, as they believe the co is well positioned to reap the benefit of outsourcing trends as companies look for ways to offset rising costs and improve operational efficiencies yet have concerns with valuation and signs of sustainable profitability improvement in Europe and GCS... Jefferies initiates Urban Outfitters (URBN 34.29) with a Hold and sets a $33 tgt, based on valuation despite attractive and highly visible long-term growth... Jefferies initiates J. Crew (JCG 28.69) with a Hold and sets a $28 tgt, based on high inventories, slowing retail comps, and lowered EPS guidance that temper the near-term outlook.
Upgrades: Wachovia upgrades Exelon (EXC 67.12) to Outperform from Market Perform... Piper Jaffray upgrades Anadys Pharma (ANDS 2.53) to Neutral from Sell. Downgrades: Wachovia downgrades Public Service Enterprise (PEG 34.23) Market Perform from Outperform... Wachovia downgrades PPL (PPL 36.48) to Market Perform from Outperform... Morgan Stanley downgrades Starwoods Hotels (HOT 32.08) to Equal Weight from Overweight. Miscellaneous: Jefferies initiates Westport (WPRT 10.66) with a Buy and $13 a tgt saying strong secular trends in favor of cleaner air (in the developed world) and the opportunity to arbitrage diesel and natural gas costs (in emerging markets) have accelerated adoption of natural gas vehicles, which are estimated to exceed 8 mln worldwide (120,000 in the U.S.)
Miscellaneous: Baird initiates Regeneron Pharma (REGN 21.10) with a Neutral and sets a $25 tgt, as they believe that a healthy level of clinical success is already factored into shares at current levels and given a lack of key near-term catalysts... Jefferies initiates United Therapeutics (UTHR 106.91) with a Buy and sets a $141 tgt, as they believe UTHR is solidifying its lead position in hte niche pulmonary arterial hypertension market and note, in addition to marketed Remodulin, anticipated market launches of the inhaled and oral formualtions of treprostinil in 2009/2010 position the co well for robust product sales and earnings growth; firm expects UTHR's product sales to continue to grow at a rapid pace (25% CAGR in 2008-2012 vs 18% for peers)... UBS initiates Patriot Coal (PCX 37.51) with a Buy and a $67 tgt.
Upgrades: Merrill Lynch upgrades Amerisourcebergen (ABC 38.36) to Buy from Neutral... Credit Suisse upgrades AMBEV (ABV 54.45) to Outperform from Neutral. Downgrades: JP Morgan downgrades Chubb (CB 53.05) to Underweight from Neutral... JP Morgan downgrades Coeur d'Alene Mines (CDE 1.90) to Neutral from Overweight... Credit Suisse downgrades Infosys (INFY 35.18) to Neutral from Outperform... HSBC downgrades Merrill Lynch (MER 26.20) to Neutral from Overweight... Credit Suisse downgrades Arrow Electronics (ARW 28.76) to Neutral from Outperform... Deutsche Bank downgrades DealerTrack (TRAK 18.56) to Hold from Buy and maintains their $18 tgt, based on valuation and believe ongoing auto demand challenges will likely outweigh the potential for a proposed bailout to improve credit access in the near term... Citigroup downgrades Praxair (PX 80.01) to Hold from Buy and lowers their tgt to $87 from $104, based on valuation coupled with slower economies in the U.S. and Europe... Citigroup downgrades Air Products (APD 73.22) to Hold from Buy and lowers their tgt to $81 from $118, following lowered Q408 EPS guidance... Credit Suisse downgrades Avnet (AVT 25.76) to Neutral from Outperform... CIBC downgrades Horsehead Holding (ZINC 6.68) to Sector Perform from Outperform... Keefe, Bruyette downgrades Whitney Holding (WTNY 26.00) to Market Perform from Outperform and raises their tgt to $25 from $20, based on valuation... Merrill Lynch downgrades F5 Networks (FFIV 24.11) to Underperform from Neutral... Merrill Lynch downgrades Juniper Networks (JNPR 24.23) to Underperform from Neutral.