Analyst Upgrades

• Interpublic Group (IPG) to buy from hold at Deutsche Bank.
• Radware (RDWR) to outperform from perform at Oppenheimer.
• Fluor (FLR) and Waddell & Reed (WDR) to buy from hold, as well as AllianceBernstein (AB) to hold from sell, at Citigroup.
• MetroCorp (MCBI) and American Capital (AGNC) to outperform from market perform at Keefe Bruyette.
• International Flavors (IFF) to overweight from equal weight at Barclays.
• BioCryst (BCRX) and Southern Company (SO) to buy from neutral at BofA/Merrill.
• Bunge (BG) to overweight from neutral at HSBC.

Analyst Upgrades

• Procter & Gamble (PG) upgraded to buy from neutral at Goldman.
• Capital One (COF) upgraded to outperform from market perform at FBR Capital.
• Airgas (ARG) upgraded to outperform from neutral at RW Baird.
• Broadcom (BRCM) upgraded to positive from neutral at Susquehanna.
• Lululemon (LULU) upgraded to hold from underperform at Jefferies.
• DryShips (DRYS) upgraded to outperform from neutral at Credit Suisse.

Analyst Upgrades

• UBS upgraded Boeing (BA) to neutral from sell, citing increased delivery forecasts. The firm raised its target to $68 from $50.
• Benchmark Co. upgraded Meredith Corp. (MDP) to buy from hold to reflect improving broadcasting and magazine advertising fundamentals. The firm raised its target for shares to $40 from $36.
• Keefe Bruyette upgraded Transatlantic (TRH) to market perform from underperform after the annual statutory data was published. The firm raised its target for shares to $51 from $4.
• Disney (DIS) was upgraded to buy from neutral at BofA/Merrill.
• Royal Caribbean (RCL) was upgraded to neutral from sell at Goldman.
• FedEx (FDX) was upgraded to outperform from market perform at Morgan Keegan.

Analyst upgrades:

• Barclays upgraded the Integrated Oil sector to Positive from Neutral citing valuations. Note that Exxon Mobil (NYSE: XOM) was upgraded to Overweight from Equal Weight based on valuation.
  
• After Force Protection (NASDAQ: FRPT) reported that its 1H08 sales increased more than 200%, Stanford thinks that Force Protection could be poised for several new opportunities in 2009 and they believe the company's risk is already priced into the stock; the firm raised Force Protection to Hold from Sell.
  
• Cowen expects eHealth (NASDAQ: EHTH) to benefit from the steady decline in employer-sponsored health insurance offered by small businesses and reduced regulatory risk, among other reasons. The firm upgraded shares to Outperform from Neutral.
• Allied Capital (NYSE: ALD) was upgraded to Market Perform from Underperform at BMO Capital.
  
• Caris upgraded Carmike Cinemas (NASDAQ: CKEC) to Above Average from Average.
  
• International Flavors & Fragrances (NYSE: IFF) was upgraded to Neutral from Underweight at JP Morgan.

MOST NOTEWORTHY: The U.S. Retail Hardlines Sector, the BioFuels Sector, Interpublic Group and Omnicom Group were today's noteworthy initiations:

• Lehman initiated the Retail Hardlines Sector with a Neutral. The firm initiated coverage of Home Depot (NYSE: HD) and Lowe's (NYSE: LOW) with Overweight ratings and Best Buy (NYSE: BBY), Bed Bath & Beyond (NASDAQ: BBBY) and Williams Sonoma (NYSE: WSM) with Equal Weight ratings.
  
• Oppenheimer initiated Aventine Renewable (NYSE: AVR), Pacific Ethanol (NASDAQ: PEIX) and VeraSun Energy (NYSE: VSE) with Perform ratings. The firm is cautious on the industry due to higher feedstock costs.
  
• UBS initiated Interpublic Group (NYSE: IPG) and Omnicom Group (NYSE:OMC) with Buy ratings and an $11 target and $62 target, respectively. The firm views valuation as attractive.

OTHER INITIATIONS:

• Morgan Stanley assumed coverage of International Flavors (NYSE: IFF) with an Overweight rating.
  
• Wachovia initiated CGI Group (NYSE: GIB) with a Market Perform rating.
  
• Leap Wireless (LEAP) was initiated at RBC Capital with a Sector Perform rating and $55 target.

Citigroup downgraded US Steel (NYSE:X) from "buy" to "hold" according to Briefing.com. The financial news service also reports that Deutsche Bank downgrade Procter & Gamble (NYSE:PG) to "hold" from "buy"

International Paper (NYSE:IP) was cut to "neutral" from "outperform" at Credit Suisse according to 24/7 Wall St. The financial website also reports that Intl Flavors & Fragrances (NYSE:IFF) was cut to "underweight" from "neutral" at JPMorgan.

Douglas A. McIntyre

Without this company, our laundry detergent would smell like cleaning fluid and our toothpaste taste like anti-freeze. International Flavors and Fragrances (NYSE: IFF) develops and manufactures the ingredients used in thousands of consumer products. The company is doing well, but you wouldn't know it by looking at its stock price.

It opened the year trading at $48.92, just about where it trades now, closing recently at $48.58, down $1.01 after reaching a high of $52.05 in mid-June. Part of the reason the stock is stuck is that IFF is thinly covered by analysts because it does not sell directly to consumers and has little name recognition.

Also, investors may be wary of any company that reports increasing interest expenses quarter after quarter. In the case of IFF, much of the interest expense increase is due to capital expenditures to build a new manufacturing facility in China, a market with huge growth potential for Western branded consumer products for which IFF will supply essential ingredients.

IIFF is in the midst of a stock repurchase program and recently authorized payment of a $0.21 per share dividend. Its P/E ratio is right at industry average, but the EPS is two and a half times industry average. The company devotes a lot of resources to R&D to track consumer tastes, literally. Such tracking is paying off handsomely in the company's increase in sales, net income and EPS quarter after quarter.

MOST NOTEWORTHY: J.B. Hunt Transport Services, Inc (JBHT), Nvidia Corp (NVDA), International Flavors & Fragrances Inc (IFF), RealNetworks, Inc (RNWK) and Marchex (MCHX) were today's noteworthy upgrades:

• Baird upgraded J.B. Hunt Transport Services Inc (NASDAQ: JBHT) to Outperform from Market Perform based on strong trends in Intermodel, valuation, and a $500M share buyback.

• Pacific Growth upgraded shares of Nvidia Corp (NASDAQ: NVDA) to Buy from Neutral citing valuation.

• Buckingham upgraded International Flavors (NYSE: IFF) to Accumulate from Neutral following the company's Q1 report.

• RealNetworks Inc (NASDAQ: RNWK) was raised to Buy from Accumulate at ThinkEquity after its Q1 report.

• Susquehanna upgraded Marchex Inc (NASDAQ: MCHX) to Positive from Neutral. Susquehanna has increased confidence that Marchex will be able to increase monetization via Yahoo!'s (YHOO) Panama upgrade, improving 2008 TAC rates and increased value of owned sites following a major upgrade for 2H07.
  

OTHER UPGRADES:

• Jefferies raised Symantec Corp (NASDAQ: SYMC) shares to Buy from Hold with a $21 target.

• JP Morgan upgraded Comverse Technology Inc (NASDAQ: CMVT).

• Raytheon Co (NYSE: RTN) was upgraded to Overweight from Equal Weight at Lehman Brothers.

• SPX Corp (NYSE: SPW) was raised to Neutral from Underperform at Needham.

• Wachovia upgraded IntercontinentalExchange, Inc (NYSE: ICE) to Outperform from Market Perform.

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

MOST NOTEWORTHY: Genesis Microchip Inc (GNSS), Columbia Sportswear Co (COLM) and Gentex Corp (GNTX) were today's most notable downgrades:

• Genesis Microchip Inc (NASDAQ: GNSS) was downgraded to Sell from Hold at Roth Capital, citing the loss of significant market share, and to Market Weight from Overweight at Thomas Weisel following the company's disappointing earnings report.

• Columbia Sportswear Co (NASDAQ: COLM) was downgraded to Sell from Hold at Matrix USA based on valuation.

• Calyon downgraded Gentex Corp (NASDAQ: GNTX) to Sell from Neutral.

OTHER DOWNGRADES:

• Following the company's fourth-quarter report, Buckingham downgraded International Flavors & Fragrances Inc (NYSE: IFF) to Neutral from Accumulate.

• Bank of America downgraded Clear Channel Communications Inc (NYSE: CCU) to Neutral from Outperform with a $37 target, as shares are pricing a best-case scenario of a deal and sees downside risk if the deal falls apart.

• Following fourth-quarter results and reduced guidance, Friedman Billings downgraded shares of Phelps Dodge Corp (NYSE: PD) to Market Perform from Outperform with a $125 target.

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