Analyst upgrades:

• Piper Jaffray upgraded PetMed Express (NASDAQ: PETS) to Overweight from Neutral following the better-than-expected Q1 results. The firm raised its target on shares to $22 from $19.
• Deutsche Bank upgraded International Paper (NYSE: IP) and Packaging Corp. (NYSE: PKG) to Buy from Hold to reflect stabilization in the containerboard industry. The firm raised its target price on Packaging Corp. to $24 from $14, and on International Paper to $24 from $16.
• Bernstein upgraded Human Genome Sciences (NASDAQ: HGSI) to Outperform from Market Perform following the positive Phase III data for Benlysta in lupus.
• IBM (NYSE: IBM) was upgraded to Hold from Sell at Societe Generale.
• British Airways (OTC: BAIRY) was upgraded to Buy from Sell at Goldman.
• Continental AG (OTC: CTTAY) was upgraded to Hold from Sell at Citigroup.

As the holidays loom, not to mention the end of the quarter, here are some highlights of this past week's earnings coverage from BloggingStocks:

• Adobe Systems Inc. (NASDAQ: ADBE) posted solid Q4 results, but left its guidance unchanged.
• Bear Stearns Cos. (NYSE: BSC) swung to a loss, another victim of the subprime mortgage mess.
• Best Buy Inc. (NYSE: BBY) beat estimates in part on sales of the Nintendo Wii and flat-panel TVs.
• CarMax Inc.'s (NYSE: KMX) net earnings declined, and the company lowered its guidance.
• Circuit City Stores (NYSE: CC) posted another disappointing quarter on "transformation" woes.
• Darden Restaurants Inc.'s (NYSE: DRI) Q2 profits fell, leading the share price to a one-year low.
• FedEx Corp. (NYSE: FDX) beat low expectations, boosted in part by international growth.
• Goldman Sachs Group (NYSE: GS) beat estimates, but not enough to impress investors.
• Herman Miller Inc. (NASDAQ: MLHR) beat estimates despite restructuring and the soft economy.
• Hovnanian Enterprises Inc.'s (NYSE: HOV) dismal results had wide-ranging effects.
• Jabil Circuit Inc. (NYSE: JBL) posted a solid quarter but lowered its outlook due to coming restructuring.
• Martek Biosciences Corp. (NASDAQ: MATK) beat expectations and raised its guidance.
• Morgan Stanley (NYSE: MS) posted worse-than-expected quarter and full-year results.
• Oracle Corp. (NASDAQ: ORCL) beat expectations on the strength of software upgrades.
• Palm Inc. (NASDAQ: PALM), reported a Q2 loss and lowered its guidance for the current quarter.
• Red Hat Inc.'s (NYSE: RHT) earnings were in line with expectations, but it raised its outlook.
• Research in Motion Ltd. (NASDAQ: RIMM) posted a solid quarter and raised its guidance.
• Take Two Interactive (NASDAQ: TTWO) warned of a higher-than-expected loss for the first quarter.
• TD Ameritrade Holding Corp. (NASDAQ: AMTD) raised its outlook for first quarter earnings.
• Walgreen Co. (NYSE: WAG) posted a solid quarter on strong sales and cost controls.

There is an outfit in Columbia, Maryland that makes nutritional substances from microbes. It sounds odd, but the stuff must be good. It is found in almost ninety percent of all U.S. infant formulas.

Martek Biosciences Corporation (NASDAQ: MATK) provides natural products derived from microalgae, fungi and other microbes. These include nutritional oils, which are used by makers of infant formula, nutritional supplements, and food and beverage fortification products. Martek also offers contract manufacturing services for the production of enzymes, specialty chemicals, vitamins and agricultural specialty products. Further, it provides fluorescent detection products, used by researchers in drug discovery and diagnostics. Customers include Dean Foods (NYSE: DF), General Mills (NYSE: GIS) and Kellogg (NYSE: K).

The firm pleased investors last week, when it reported Q4 EPS of 23 cents and revenues of $82 million. Analysts had been expecting 20 cents and $78.4 million. Management also guided Q1 EPS to 21-23 cents (17 cent consensus) and Q1 revenues to $79-83 million ($77.30M consensus). For FY08, the company expects year over year growth in both revenues and profitability.

Good news from Martek Biosciences Corp. (NASDAQ: MATK) recently. Its product, Martek's life'sDHA (docosahexaenoic acid) was recently proven to lower bad cholesterol in adult males, in addition to its proven effectiveness in infant formula to foster eye and central nervous system development. CEO Steve Dubin stated that the company is seeking not only new markets for its existing products, but is also ramping up R&D to develop new products. One new market, potentially huge, is China, for which Martek recently received permission to market Martek life'sDHA for food use.

Martek recently released 3Q (third quarter) 2007 results which include the launch of 8 new products containing life'sDHA. Sales in 3Q increased 12% to $74.5 million. Year to date (YTD) sales are up 11% to $213.5 million, led by rising demand by both domestic and international customers for Martek's infant formula. Martek life'sDHA is found in Breyers Yougurt and General Mills' Yoplait Kids, as well as equivalent products internationally. The one negative ripple in this pool of otherwise good news is that Martek supplies life'sDHA to Dean Foods Company (NYSE: DF), the country's largest supplier of raw milk products. Dean Foods is having financial problems and may be forced to scale back production, which will in turn lower sales of life'sDHA. But in what might turn out to be an ever bigger market, life'sDHA may help in medications used to treat clinical depression. Clinical studies for this usage are continuing.

Martek recently sold off its Fluorescent Detection Products unit to a group of former employees, leaving Martek free to concentrate on expanding applications for life'sDHA. The company also paid down its long-term debt by $19 million over the past 9 months. The company provided 4Q guidance of revenues between $77-80 million, net income between $6.5-$6.8 million, EPS of $0.20-$0.21. Revenues for FY 2007 are forecast at $302-305 million, with EPS of $0.62-$0.63, a growth rate of 12%.

There is an outfit in Columbia, Maryland that makes nutritional substances from microbes. It sounds odd, but the stuff must be good. It is found in almost 90% of all U.S. infant formulas.

Martek Biosciences Corporation (NASDAQ: MATK) provides natural products derived from microalgae and fungi. These include nutritional oils, which are used by makers of infant formula, nutritional supplements, and food and beverage fortification products. Martek also offers contract manufacturing services for the production of enzymes, specialty chemicals, vitamins and agricultural specialty products. Further, it provides fluorescent detection products, used by researchers in drug discovery and diagnostics. Customers include Dean Foods Co. (NYSE: DF), General Mills Inc. (NYSE: GIS) and Kellogg Company (NYSE: K).

The firm pleased investors last week, when it reported Q2 EPS of 15 cents and revenues of $76.7 million. Analysts had been expecting 15 cents and $76.3 million. Management also guided Q3 EPS to 18-21 cents (17 cent consensus), Q3 revenues to $77-$80 million ($77.90M consensus), FY07 EPS to 62-66 cents (61 cent consensus) and FY07 revenues to $301-$306 million ($301.67M consensus). MATK shares popped through 200-day moving average resistance into the initial stage of a bullish "flag" consolidation pattern on the news. Prices frequently exit flags moving in the same direction they were traveling when they entered them. In this case, that would be to the upside. Note that the move into the flag completes the formation of a "double bottom" pattern, another bullish sign of further gains.

Brokers recommend the issue with two "buys," one "hold" and one "sell." Analysts expect a 35% growth rate through the next year. The MATK Price to Sales ratio (2.78) and Price to Book ratio (1.56) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 82% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $19.64 and $30.84. A stop-loss of $19.95 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.