Each weekday, TheStreet.com Ratings updates its ratings on the stocks we cover. Our model projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Our buy, hold or sell ratings designate how we expect these stocks to perform against a general benchmark of the equities market and interest rates.
While our 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.
Some recent rating changes are highlighted below.
Software company Adobe (ADBE) has been upgraded to a buy from a hold. The company reported a 36.9% year-over-year profit increase in the first quarter of fiscal 2007. During the quarter, the company benefited from investment gains, higher interest income and a lower tax rate. Adobe is also about to upgrade its popular Creative Suite 3 product. The company had been rated a hold since July 2006.Radio and television broadcaster Westwood One (WON) has been downgraded to a sell from a hold. The company's revenues, net income and earnings per share have all declined over the past fiscal year. The current debt-to-equity ratio is 1.81, which TheStreet.com Ratings feels is quite high. Westwood One had been rated a hold since January 2007.