MOST NOTEWORTHY: Gander Mountain, Lev Pharmaceuticals, Intermune, Aetna and Medco Health were today's noteworthy initiations:

• Nollenberger initiated shares of Gander Mountain Company (NASDAQ: GMTN) with a Sell rating and $5.00 target, and believes the company's goal of reaching profitability in 2007 could prove overly optimistic.
  
• Lev Pharmaceuticals (OTC: LEVP) was initiated with a Sector Outperformer rating and $3 target at CIBC, as the firm believes Cinryze will likely be approved in 1Q08 and they expect the company to have significant pricing leverage.
  
• JP Morgan resumed coverage of Intermune Inc (NASDAQ: ITMN) with an Overweight rating and expects shares to be driven by the company's pipeline in IPF and HCV.
  
• Aetna Incorporated (NYSE: AET) was initiated with an Outperform rating at Wachovia. The firm feels Aetna is positioned for better growth and higher quality earnings than its peers.
  
• William Blair started shares of Medco Health Solutions Inc (NYSE: MHS) with an Outperform rating, as they believe an aging population, rising health care costs, and an acceleration in new product introductions should increase demand for PBM services over the next five years.

OTHER INITIATIONS:

• ABN Amro started shares of Siliconware Precision Industries Company Ltd (NASDAQ: SPIL) and Advanced Semiconductor Engineering Inc (NYSE: ASX) with Buy ratings.
  
• Goldman initiated Silicon Image Inc (NASDAQ: SIMG) with a Sell rating and $4.50 target, and initiated Sigma Designs Inc (NASDAQ: SIGM) and SiRF Technology Holdings Inc (NASDAQ: SIRF) with Neutral ratings and a $43 target and $19 target, respectively.

In most businesses, diversification is the key to steady profits. There is a chip manufacturer in Sunnyvale, California that recognizes that truth and successfully serves a variety of different consumer electronics markets.

Silicon Image (NASDAQ: SIMG) designs and develops semiconductors for the secure storage, distribution and presentation of digital content. Its products are used in a variety of devices, including digital televisions, DVD players, set-top boxes, audio/video receivers, game consoles, high definition camcorders and digital still cameras. The company also offers its own consumer electronics devices, including high-definition multimedia interface transmitters and receivers, as well as products that connect PCs to digital displays. Silicon Image has strategic relationships with the likes of Walt Disney (NYSE: DIS), Sony (NYSE: SNE) and Hitachi (NYSE: HIT). Texas Instruments (NYSE: TXN) is a major competitor.

The firm pleased investors earlier in the month, when it announced that it expected first quarter revenues to come in essentially in-line with the consensus Street estimate. Management also said it sees gross margins exceeding the previously provided range. RBC Capital Markets subsequently upgraded the stock to "outperform."

MOST NOTEWORTHY: SanDisk (SNDK), Lear (LEA) and Sunoco, Inc (SUN) were today's most notable upgrades:

• SanDisk Corp. (NASDAQ:SNDK) was upgraded at Goldman Sachs to Buy from Neutral because they expect an improved NAND pricing environment.
• Baird upgraded Lear Corp. (NYSE:LEA) to Neutral from Underperform, with a $36 target, following the buyout offer from Carl Icahn's American Real Estate Partners LP for $36 a share.
• Deutsche Bank upgraded shares of Sunoco, Inc (NYSE:SUN) to Buy from Hold due to better-than-expected demand as well as rising East Coast margins.

OTHER UPGRADES:

• Merriman upgraded 8x8, Inc (NASDAQ:EGHT) to Buy from Neutral. The firm believes that by focusing on the SOHO VoIP market, 8x8, Inc has formed a solid revenue base from which to grow; the broker also finds shares undervalued.
• Wachovia upgraded shares of Parkway Properties, Inc. (NYSE:PKY) to Outperform from Market Perform based on relative valuations, as opposed to Highwoods Properties (HIW), which was downgraded today.
• Stifel took RealNetworks, Inc. (NASDAQ:RNWK) up to Hold from Sell on valuation.
  
• Goldman reinstated Catalina Marketing Corp. (NYSE:POS) with a Neutral, up from its previous Sell rating.
• American Technology added Silicon Image, Inc. (NASDAQ:SIMG) to its Focus List, as the firm believes its recent weakness provides investors with a buying opportunity.
• Matrix US upgraded MapInfo Corp. (NASDAQ:MAPS) to Hold from Sell based on valuation.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

MOST NOTEWORTHY: Roche Holdings AG (RHHBY), US Steel Corp (X) and Penn National Gaming (PENN) topped today's list of most notable downgrades:

• Bear Sterns downgraded Roche Holdings AG (OTC: RHHBY), to Peer Perform from Outperform after they lowered estimates to reflect higher taxes, slowing pharmaceutical sales, increased payments to third-party groups and reduced diagnostics profitability. Bernstein also downgraded Roche to Market Perform from Outperform.

• CIBC downgraded U.S. Steel Corp (NYSE: X) to Sector Performer from Sector Outperformer based on valuation. Bank of America also downgraded shares to Neutral from Buy with a $90 target citing the good news is reflected in the valuation.

• Penn National Gaming (NASDAQ: PENN) was downgraded to Hold from Buy on valuation with a $48.50 target.

OTHER DOWNGRADES:

• Silicon Image Inc (NASDAQ: SIMG) was downgraded to Underperform from Hold with a $7.50 target at Jefferies to reflect slow 1.3 HDMI adoption, aggressive 2007 guidance and deteriorating ASPs and margins; the firm recommends investors sell the stock. Silicon Image was also downgraded to Hold from Buy at Stanford and Needham, to Sector Performer from Outperformer at CIBC and to Neutral from Buy at DA Davidson.

• Spectrum Brands Inc (NYSE: SPC) was downgraded to Underweight from Neutral with a $7 target at Prudential following the company's disappointing first quarter results.

• Bear Stearns downgraded Forward Air Corp (NASDAQ: FWRD) to Underperform from Peer Perform.

• AG Edwards downgraded Callaway Golf Corp (NYSE: ELY) to Hold from Buy on valuation.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).