TheStreet.com Ratings: Stock Upgrades, Downgrades

Each weekday, TheStreet.com Ratings updates its ratings on the stocks it covers. The proprietary ratings model projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Buy, hold or sell ratings designate how the Ratings group expects these stocks to perform against a general benchmark of the equities market and interest rates.

While the ratings model is quantitative, it uses both subjective and objective elements. For instance, subjective elements include expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings. Objective elements include volatility of past operating revenue, financial strength and company cash flows.

Software giant Microsoft(MSFT Quote) has been downgraded to a hold from a buy. The company's profits increased 65.6% in the third quarter of fiscal 2007 compared to the same quarter a year ago, thanks to sales of the company's latest operating system software Vista.

However, a jump in operating income due to higher revenue has been partially offset by increased headcount-related costs and advertising and marketing expenses associated with new product launches. Revenue from the entertainment and devices segment went down 21.4% over the past fiscal year because of decreased Xbox 360 sales. Microsoft had been rated a buy since September 2006.

Memory card maker SanDisk(SNDK Quote) has been boosted to a buy from a hold. The company's revenue has grown 26.1% over the past fiscal year. Net operating cash flow reached $255.3 million in the first quarter of fiscal 2007, a 386.7% jump from the same quarter a year ago. The company's debt-to-equity ratio is below the computers and peripherals industry average. SanDisk had been rated a hold since January 2007.

Pharmaceutical firm Bristol-Myers Squibb(BMY Quote) has been upgraded to a buy from a hold. The company's stock price has increased 17.1% in the past year. TheStreet.com Rating's feels Bristol-Myers Squibb's current 68.9% gross profit margin is rather high. Although earnings per share have been declining over the past fiscal year, analysts are looking for an increase in the future. The company has been rated a hold since October 2006.

Fast food chain Wendy's(WEN Quote) has been upgraded to a hold from a sell. The company earned 15 cents per share in the first quarter of fiscal 2007, after losing 5 cents per share in the same quarter a year ago. TheStreet.com Ratings feels Wendy's is poised for further earnings growth in the coming year. Wendy's had been rated a sell since March 2007.

Taser(TASR Quote) has been downgraded to a sell from a hold. The company makes electronic stun devices. Taser has reported a decline in earnings per share over the past fiscal year. The stock price has tumbled 27.1% in 12 months. The company has a negative return on equity that is well below the industry average. Taser had been rated a hold since October 2006.

Additional ratings changes are listed in the table below.

TheStreet.com Ratings Stock Upgrades, Downgrades
Company Name	Ticker	Change	New Rating	Former Rating
Legacy Bancorp	LEGC	Downgrade	Hold
Vivid Learning Systems	VVDL	Upgrade	Hold	Sell
Greenhill & Co.	GHL	Downgrade	Hold	Buy
Cohen & Steers	CNS	Upgrade	Buy	Hold
On Track Innovations	OTIV	Upgrade	Hold	Sell
Sun American bancorp	SAMB	Downgrade	Hold	Buy
Align Technology	NBTF	Upgrade	Buy	Hold
Kyphon	KYPH	Downgrade	Hold	Buy
Wendy's International	WEN	Upgrade	Hold	Sell
Taser International	TASR	Downgrade	Sell	Hold
Fauquier Bankshares	FBSS	Downgrade	Hold	Buy
Shenandoah Telecom	SHEN	Upgrade	Buy	Hold
Supportsoft	SPRT	Downgrade	Sell	Hold
Quigley	QGLY	Downgrade	Sell	Hold
Regis	RGS	Downgrade	Hold	Buy
Ryland Group	RYL	Downgrade	Hold	Buy
Sandisk	SNDK	Upgrade	Buy	Hold
Microsoft	MSFT	Downgrade	Hold	Buy
Nic Inc.	EGOV	Upgrade	Buy	Hold
New York Cmnty Bancorp	NYB	Upgrade	Buy	Hold
Northeast Utilities	NU	Downgrade	Hold	Buy
Knightsbridge Tankers	VLCCF	Upgrade	Buy	Hold
Mattson Technology	MTSN	Upgrade	Buy	Hold
Mentor Graphics	MENT	Downgrade	Hold	Buy
Huaneng Power International	HNP	Upgrade	Buy	Hold
Interface inc	IFSIA	Downgrade	Hold	Buy
Franklin Covey	FC	Downgrade	Hold	Buy
Frontier Financial	FTBK	Upgrade	Buy	Hold
Gsi Commerce	GSIC	Downgrade	Hold	Buy
Newmarket	NEU	Upgrade	Buy	Hold
Fair Isaac	FIC	Downgrade	Hold	Buy
Align Technology	ALGN	Upgrade	Hold	Sell
Bristol-Myers Squibb	BMY	Upgrade	Buy	Hold
Brunswick	BC	Downgrade	Hold	Buy
Btu International	BTUI	Downgrade	Hold	Buy
Source: TheStreet.com Ratings