Analyst upgrades:

• Canaccord upgraded Rio Tinto (NYSE: RTP) to Buy from Hold citing valuation following the severe price decline following BHP Billiton's (NYSE: BHP) dropped bid.
• UBS upgraded Itron (NASDAQ: ITRI) to Buy from Neutral citing valuation and defensive business mix.
• Jefferies upgraded shares of HealthSouth (NYSE: HLS) to Buy from Hold on valuation and maintains a $13.50 target.
• Melco PBL Entertainment (NASDAQ: MPEL) was raised to buy from Neutral at Goldman.
• PG&E (NYSE: PCG) was upgraded at Merrill Lynch to Buy from Neutral.
• HSBC Holdings (NYSE: HBC) was upgraded to Buy from Neutral at UBS.

Analyst downgrades:

IPOs tentatively scheduled to price during the week of December 18, 2006 include:

• Artes Medical (ARTE), a medical company that's developing injectable aesthetic products for dermatology and plastic surgery products. ARTE has a $12.00-$14.00 filing range.
  
• Dayton Superior (DSUP), a provider of specialized products for the construction market; filing range: $13.00-$15.00.
• Fuwei Films (FFHL), [Note: FFHL possibly will price the week of December 18], a manufacturer of specialized plastic for packaging and imaging; filing range: $8.00-$12.00.
  
• Melco PBL Entertainment (MPEL), a developer of casino gaming and entertainment resort facilities; filing range: $16.00-$18.00.
  
• Oculus Innovative Sciences (OCLS), a developer of wound / infection treatments; filing range: $12.00-$14.00.
  
• Solarfun Power (SOLF), a manufacturer of photovoltaic and PV modules; filing range: $11.50-$13.50.
  
• Transforma Acquisition (TAQ), a blank check company formed for the purpose of acquiring tech/media/telecom assets or businesses; filing price: $10.00.
  
• Universal Power Group (UPG), a supply-chain management company; filing range: $7.00-$9.00.

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