MOST NOTEWORTHY: Palm, Inc (PALM), Reliant Energy, Inc (RRI) and Take-Two Interactive Software (TTWO) topped today's more notable downgrades:
- UBS cut Palm, Inc (NASDAQ: PALM) to Reduce from Neutral citing valuation. Bank of America downgraded shares to Neutral from Buy with an $18 target and considers the risk/reward less favorable at these levels.
- Bank of America also downgraded Reliant Energy (NYSE: RRI) to Sell from Neutral on valuation.
- Hillard Lyons cut Take-Two Interactive Software (NASDAQ: TTWO) to Neutral from Outperform.
OTHER DOWNGRADES:
- CIBC downgraded Jabil Circuit, Inc (NYSE: JBL) to Sector Performer from Outperformer following the company's disappointing outlook. Bear Stearns cut Jabil to Peer Perform from Outperform. BMO cut the company to Market Perform from Outperform.
- Friedman, Billings, Ramsey downgraded shares of FormFactor, Inc (NASDAQ: FORM) to Market Perform from Outperform to reflect increased risks in the logic market and long-term growth concerns.
- Matrix USA downgraded Knight Transportation (NYSE: KNX) to Hold from Buy.
- American Technology downgraded shares of Comverse Technology, Inc (NASDAQ: CMVT) to Neutral from Buy as the firm believes a retreat to the $17 range is likely given the company's disappointing margin trends.
- CL King cut Claire's Stores, Inc (NYSE: CLE) to Neutral from Strong Buy following the buyout offer.
- Goldman downgraded Atmos Energy Corp (NYSE: ATO) to Sell from Neutral and Liz Claiborne, Inc (NYSE: LIZ) to Neutral from Buy.
Analyst summaries provided by TheFlyOnTheWall.com (subscription required).
MOST NOTEWORTHY: ColdWater Creek Inc (CWTR), Celadon Group, Inc (CLDN), Berry Petroleum Co (BRY), SiRF Technology Holdings Inc (SIRF) were today's noteworthy initiations: 
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No Cramer, now is not the time to panic!
