MOST NOTEWORTHY: Microsoft (MSFT), Sony Corp (SNE), Adobe Systems Inc (ADBE) and the cable sector were today's noteworthy upgrades:
DA Davidson upgraded Microsoft Corp (NASDAQ: MSFT) to Buy from Neutral, as the firm is no longer concerned the tech giant will acquire Yahoo! (YHOO) following the recent acquisition of aQuantive, Inc (AQNT).
HSBC upgraded shares of Sony Corp (NYSE: SNE) to Overweight from Neutral to reflect improving profitability at Sony's electronics business.
Pacific Crest upgraded Adobe Systems (NASDAQ: ADBE) to Outperform from Sector Perform to reflect the strong CS3 outlook and growth in new areas such as mobile.
Citigroup upgraded their cable sector view as they continue believe cap ex will remain at elevated levels at a time when the marginal cable investor is likely more willing to forego near-term FCF growth to achieve robust EBITDA growth. Along with the raised sector view, Citigroup upgraded Time Warner Cable (NYSE: TWC) and Comcast Corp (NASDAQ: CMCSA) to Buy from Hold. The firm believes investors can benefit from owning both EchoStar Communications (DISH) and cable equities...
OTHER UPGRADES:
Bear Stearns upgraded Tiffany & Co (NYSE: TIF) to Outperform from Peer Perform.
MOST NOTEWORTHY: Tenet Healthcare Corp (THC), Furniture Brands International, Inc (FBN), Sepracor Inc (SEPR), ValueClick, Inc (VCLK) and Altria Group, Inc (MO) were today's noteworthy downgrades:
Bear Stearns downgraded shares of Tenet Healthcare (NYSE: THC) to Underperform from Peer Peform citing difficulties in California and weak margins.
Stifel downgraded Furniture Brands (NYSE: FBN) to Sell from Hold citing concerns regarding continued weakness in the housing industry.
Summer Street downgraded Sepracor (NASDAQ: SEPR) to Sell from Neutral after the HCPCS website indicated Xopenex and Albuterol will have the same code as of July 1.The firm believes this eliminates the optimistic scenarios that Sepracor can garner a minimal-or-no-reimbursement cut.
RBC downgraded shares of ValueClick (NASDAQ: VCLK) to Underperform from Sector Perform as the firm believes the FTC letter poses a risk to earnings and that the company is unlikely to be acquired.
Matrix downgraded Altria Group (NYSE: MO) to Buy from Strong Buy to reflect decreasing cigarette sales and increasing valuation...
OTHER DOWNGRADES:
American Technology cut Autodesk, Inc (NASDAQ: ADSK) to Neutral from Buy.
Matrix downgraded Fluor Corp (NYSE: FLR) to Sell from Buy.
MOST NOTEWORTHY: Dow Chemical (DOW), Smart Modular (SMOD), Wolverine World Wide (WWW), Win-Dixie Stores (WINN) and Blue Nile (BLUE) were today's noteworthy initiations:
UBS is positive on the ethylene cycle over the next two years and believes Dow Chemical (NYSE: DOW) can beat 2008 consensus estimates, initiating shares with a Buy rating.
JMP Securities started Smart Modular (NASDAQ: SMOD) with a Strong Buy as a unit volume growth theme without much dependence on commodity memory chip pricing.
Citigroup expects further upside given Wolverine World Wide's (NYSE: WWW) strong portfolio of brands, further growth opportunities through line extensions and international growth. The firm started Wolverine World Wide with a Buy rating and $33 target.
Winn-Dixie Stores (NASDAQ: WINN) was started with a Market Perform rating, citing low levels of profitability and unproven ability to drive sustainable profitable sales.
American Technology believes the valuation of Blue Nile (NASDAQ: NILE) leaves little room for upside, despite a highly attractive business model and strong fundamentals, and started shares with a Sell rating and $45 target...
MOST NOTEWORTHY: Specialty pharmaceutical companies make up today's most noteworthy list:
The Bank of America initiated Shire plc (NASDAQ: SHPGY), Mentor Corp (NYSE: MNT), Alcon, Inc (NYSE: ACL) and Allergan, Inc (NYSE: AGN) with Buy ratings and initiated Cephalon, Inc (NASDAQ: CEPH), Forest Laboratories, Inc (NYSE: FRX), Sepracor Inc (NASDAQ: SEPR) with Neutral ratings. Bank of America's top pick is Shire plc as the firm expects the company to launch six products or product extensions by mid-2008, followed by Mentor Corp, as the conversion to silicone breast implants should drive a period of stronger-than-expected sales and earnings.
OTHER INITIATIONS:
Ford Motor Co (NYSE: F) was initiated at Buckingham with an Underperform rating and General Motors (GM) was started with a Neutral rating.
Nollenberger believes Under Armour, Inc (NYSE: UA), started with a Buy rating, is positioned to outperform the market based on the strength of its brand name and demand through the continued introduction of new products along with European growth.
Barr Pharmaceuticals, Inc (NYSE: BRL) was initiated with an Equal Weight rating and $53 target at Morgan Stanley.
MOST NOTEWORTHY: RadioShack Corp (RSH), Juniper Networks, Inc (JNPR), H.B. Fuller Co (FUL) and Sepracor Inc (SEPR) were today's more notable downgrades:
Morgan Stanley downgraded RadioShack (NYSE: RSH) to Underweight from Equal-Weight on concerns over the company's wireless fundamentals and top-line growth.
Juniper Networks (NASDAQ: JNPR) was downgraded to Strong Sell from Buy at Matrix USA. The firm sees downside to the intrinsic value calculation of $12 given the company's deteriorating fundamentals.
H.B. Fuller Co (NYSE: FUL) was cut to Sell from Hold at Gabelli following a meeting with management to reflect the recent management exists and the broker's expectation for a challenging first-half of 2007.
Sepracor (NASDAQ: SEPR) was cut to Underperform from Market Perform at Friedman Billings, as the firm believes generic availability of Ambien may be a bigger challenge to Seprecor's Lunesta than investors expect.
OTHER DOWNGRADES:
Jackson Hewitt Tax Service Inc (NYSE: JTX) was cut to Underweight from Market Weight at Thomas Wiesel as they believe the potential near-term competitive trends coupled with potential issues with rising financial product contribution will weigh on valuation.
Bear Stearns cut Cerner Corp (NASDAQ: CERN) to Peer Perform from Outperform.
Matrix USA downgraded InfoSpace, Inc (NASDAQ: INSP) to Hold from Buy on valuation.
Prudential cut Unilever plc (NYSE: UL) to Neutral from Overweight.
Breen Murray downgraded Century Casinos, Inc (NASDAQ: CNTY) to Hold from Buy.
Cowen downgraded PeopleSupport, Inc (NASDAQ: PSPT) to Neutral from Outperform based on near-term visibility concerns.
MOST NOTEWORTHY: aQuantive Inc(AQNT) and Vanda Pharmaceuticals Inc (VNDA) were today's most notable initiations:
CIBC initiated aQuantive Inc (NASDAQ: AQNT) with a Sector Performer rating and $30 target. The firm believes aQuantive's key challenge is margin pressure from the rising cost of talent, but they expect strong fourth-quarter results.
Friedman Billings is positive on Vanda Pharmaceuticals Inc's (NASDAQ: VNDA) lead drug candidate, atypical antipsychotic iloperidone, which showed positive data in Ph III studies for schizophrenia; Friedman started the company with an Outperform rating and $40 target.
OTHER INITIATIONS:
Canaccord started Unica Corp (NASDAQ: UNCA) with a Buy rating and $15 target.
Oppenheimer initiated Community Bancorp NV (NASDAQ: CBON) with a Buy rating and $38 target.
Bank of America initiated ConAgra Foods Inc (NYSE: CAG) with a Neutral rating and $27 target based on valuation.
Stephens put a $20 target on ACA Capital Holdings Inc (NYSE: ACA) and started the company with an Overweight rating.
Friedman Billings says Sepracor Inc's (NASDAQ: SEPR) Lunesta faces generic challenges and that 2007 guidance may be hard to achieve; the firm started Sepracor with a Market Perform rating and $58 target.
The death of cholesterol drug Torcetrapib, which caused Pfizer's (NYSE:PFE) stock to plunge 12% yesterday, has forced the company into purchasing growth rather than developing it. With the company's biggest drug, Lipitor, losing patent exclusivity in 2010, Pfizer must now hurry to acquire potential blockbuster drugs to maintain revenue, since its own pipeline is all but dried up. Company VP David Shedlarz said of the M&A market, "Now we will attack it with a greater sense of urgency."
This desperation means overpaying for possible franchise drugs, which means a potential early Christmas for takeover targets. One such target, according to TheDeal.com [subscription required], is Sepracor (NASDAQ:SEPR), which makes sleep and allergy drugs. Another possible target, according to W.R. Hambrecht, is Nektar Therapeutics (NASDAQ: NKTR), a biopharmaceutical company which makes drug delivery technologies.
MOST NOTEWORTHY: Microsoft (MSFT), Sony Corp (SNE), Adobe Systems Inc (ADBE) and the cable sector were today's noteworthy upgrades: 
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