Stock Upgrades, Downgrades From TheStreet.com Ratings

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 company earnings forecasts. Objective elements include volatility of past operating revenue, financial strength and company cash flows.

Bank of America(BAC Quote), a provider of banking and non-banking financial services, has been upgraded to buy from hold. The company's strengths are seen in multiple areas, including revenue growth, attractive valuation levels, good cash flow from operations and expanding profit margins. It has displayed a two-year pattern of positive EPS growth, a trend that should continue, as the market expects earnings to improve to $4.90 per share for the current year, from $4.60 per share in 2006.

The stock's price-to-earnings ratio of 10.17 is lower than the industry average of 16.43, while its price-to-book ratio of 1.59 is below both the S&P 500 average of 2.83 and the financial services industry average of 2.34. Bank of America's strengths outweigh its generally poor debt management on most measures evaluated by TheStreet.com Ratings. The company had been rated hold since June 2007; prior to that, it had had a buy rating since August 2005.