Tuesday's Analysts' Upgrades and Downgrades

TSC Staff

CHANGE IN RATINGS

Avaya (AV Quote) coverage initiated at Jefferies: Jefferies is initiating coverage on AV with a Hold rating. See risks associated with gradual shift from TDM-phone systems to IP-systems. Look for better entry point after recent run-up in share price. Price target at $12.50.

Barr Pharma (BRL Quote) upgraded at Goldman Sachs: Goldman is upgrading BRL to Buy from Outperform due to upcoming drug launch catalysts, improved visibility on PLIVA transaction, and compelling valuation. Price target at $71.

Career Education (CECO Quote) upgraded at UBS: UBS is upgrading CECO to Neutral from Reduce based on recent departure of CEO. Believes management change is positive but still sees downside earnings risk. Raised target price to $22 from $18.

Comcast (CMCSA Quote) downgraded at AG Edwards: CMCSA was downgraded to Hold at AG Edwards. Valuation call, as the stock is up 41% year-to-date and approaching fair value of $37.

Cisco (CSCO Quote) coverage initiated at Jefferies: Jefferies is initiating coverage of CSCO with a Buy rating. Expect accelerating revenue growth due to market share gains, penetration of under-networked segments, and increased service provider spending on upgrades. Price target at $30.

EGL (EAGL Quote) upgraded at Baird: EAGL was upgraded to Outperform at Robert Baird. $44 price target. Valuation is attractive, and confidence is increasing that revenue growth could re-accelerate in the near term.

Adv. Medical Optics (EYE Quote) downgraded at Bear: EYE was downgraded to Peer Perform at Bear Stearns. Visibility is less at the company's highest margin business. Estimates also cut, following the company's latest warning.

Adv. Medical Optics (EYE Quote) estimates lowered at UBS: UBS is lowering its 2006 EPS estimates on EYE to $1.92 from $2.10 after management reduced guidance. Lowered target price to $49 from $52.

Adv. Medical Optics (EYE Quote) estimates cut at Morgan Stanley: Morgan Stanley is cutting 2006-2007 EPS estimates to reflect the company's recent guidedown.

Foundry Networks (FDRY Quote) coverage initiated at Jefferies: FDRY coverage initiated with a Buy rating at Jefferies. Recovery in government business and seasonal strength in enterprise spending could drive price appreciation. Price target at $15.

F5 Networks (FFIV Quote) coverage initiated at Jefferies: FFIV coverage initiated with a Buy rating at Jefferies. See company benefiting from increased investments in data centers and growing demand for application-aware networking. Price target set at $65.

Harrah's Entertainment (HET Quote) downgraded at JP Morgan: HET was downgraded from Overweight to Neutral at JP Morgan. Estimates also cut, as domestic EBITDA trends are lagging.

Jackson Hewitt (JTX Quote) downgraded at Morgan Stanley: Morgan Stanley is cutting numbers and downgrading Jackson Hewitt to underweight from equal-weight. The company faces serious headwinds heading into this years tax season, according to Morgan Stanley.

Lear (LEA Quote) upgraded at UBS: UBS is upgrading LEA to Neutral from Reduce based on valuation. Raised target price to $20 from $19.

Altria (MO Quote) downgraded at AG Edwards: MO was downgraded from Buy to Hold at AG Edwards. Legal setback will delay a breakup of the company, bringing some uncertainty to the model.

Altria (MO Quote) numbers cut at Morgan Stanley: Morgan Stanley is trimming 2006-2008 EPS estimates and notes that the Schwab ruling is likely to delay the Kraft spinout by up to a year.

Micron Technology (MU Quote) downgraded at Credit Suisse: Credit Suisse is downgrading MU to Neutral from Outperform based on expected DRAM oversupply in 1H 2007. Maintained $19 target price.

Piper Jaffray (JCP Quote) downgraded at Wachovia: JCP was downgraded from Outperform to Market Perform at Wachovia. Stock has been a steady gainer, and the benefit of the company's buyback program has likely already been priced into the shares.

Verizon (VZ Quote) downgraded at AG Edwards: VZ was downgraded to Hold at AG Edwards. Valuation call, as the stock is up 25% on the year, and near its fair value of $38 a share.

Western Union (WU Quote) rated new Neutral at UBS: UBS is initiating coverage on WU with a Neutral rating. Sees near-term opportunities along with competition and regulatory scrutiny risk. Sets $20 target price.

STOCK COMMENTS / EPS CHANGES

Cephalon (CEPH Quote) estimates raised at Jefferies: Jefferies is increasing its 2006 estimates on CEPH by 6 cents to $3.89 after FDA approved Fentora, which will launch in coming months. Reiterate Hold rating and $56.50 target.

Cablevision (CVC Quote) estimates increased at Jefferies: Jefferies is increasing its 2006 estimates for CVC to ($0.33) from ($0.82) after company filed full Q2 documentation and re-stated previous results, adjusting for stock option inconsistencies. Reiterated Buy rating and $26 target.

eBay (EBAY Quote) price target cut at Goldman Sachs: Goldman is cutting its target on EBAY to $35 from $54 based on 1.3x PEG model input. Recommend buying shares given accelerating growth in GMV and revenue. Reiterated Buy rating.

Advanced Medical Optics (EYE Quote) target lowered at Goldman: Price target on EYE decreased to $46 from $52 at Goldman. Company reduced 2006 and 2007 guidance due to softer revenue expectations. Maintained Neutral rating.

PMC-Sierra (PMCS Quote) estimates cut at UBS: UBS is lowering its 2006 EPS estimates on PMCS to 22 cents from 30 cents after company reduced guidance. Lowered target price to $11 from $16.

PMC-Sierra (PMCS Quote) numbers cut at Morgan Stanley: Morgan Stanley is cutting PMC-Sierra's estimates of 2006-2007 to reflect the company's recently lowered revenue guidance.

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