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.

Lear (LEA), which makes automotive seats, electrical distribution and electronic products, has been upgraded to a hold from a sell. The company's earnings improved to $1.58 per share in the second quarter compared with a loss of 10 cents a share in the same period last year. In the last 12 months, its stock price has increased by 62.94%. However, the company's revenue fell by 13.6% in the second quarter compared with the same period last year, and its net profit margin of 3.0% trails the industry average. Lear's debt-to-equity ratio of 2.95 is higher than the industry average, implying that there is very poor management of debt levels within the company. It had been rated a sell since October 2005.

LivePerson (LPSN), which provides hosted software that enables customers to assist their online visitors, has been upgraded to a buy from a hold. The company's revenue increased 57.2% in the second quarter compared with the same period last year, and net income grew 127.7% to $910,000 over the same time frame. LivePerson's stock price has improved by 21.92% in the last 12 months, outperforming the rise in the S&P 500 over the same period. Looking ahead, unless broad bear market conditions prevail, TheStreet.com Ratings team sees further upside potential for this stock. The company had been rated a hold since May 2007.

Logistics technology provider The Descartes Systems Group (DSGX) has been upgraded to a buy from a hold. The company improved its earnings by 50.0% in the second quarter compared with the same period last year. Powered by strong earnings growth and other driving factors, the stock price has grown by 25.79% in the last 12 months, and should continue to move higher despite the fact that it has already enjoyed nice gains in the past year. Descartes has no debt to speak of, and maintains a quick ratio of 6.25, which demonstrates the ability to cover short-term cash needs. These strengths outweigh the fact that the company has had somewhat disappointing return on equity. Descartes had been rated a hold since May 2007.

Arrow Financial (AROW), the holding company for Glens Falls National Bank and Trust and Saratoga National Bank and Trust, has been upgraded to a buy from a hold. The company's net operating cash flow has increased 49.49% to $10.49 million in the second quarter compared with the same period last year. Arrow Financial has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings moving forward. The company also shows expanding profit margins and attractive valuation levels. Given these strengths, the stock price's decline of 4.49% in the last 12 months is not a concern. Arrow Financial had been rated a hold since June 2007.

Symmetricom (SYMM) supplies timing and synchronization hardware, software and services to industry, government, utilities, research centers and aerospace markets worldwide. It has been downgraded to a sell from a hold. The company's stock price is down 39.21% in the past 12 months, and despite the heavy decline, this stock is still more expensive (when compared to current earnings) than most other companies in its industry. Net income decreased 37.1% to $1.24 million in the second quarter compared to the same period last year, although its return on equity improved to 2.48% over the same time frame. Symmetricom had been rated a hold since September 2005.

Additional ratings changes are listed below:

Stock Upgrades, Downgrades
Company Name	Ticker	Change	New Rating	Former Rating
NOBEL LEARNING CMNTYS INC	NLCI	Upgrade	Buy	Hold
STARRETT (L.S.) CO	SCX	Upgrade	Buy	Hold
TAITRON COMPONENTS	TAIT	Downgrade	Sell	Hold
UIL HOLDINGS CORP	UIL	Upgrade	Buy	Hold
UNITED RETAIL GROUP INC	URGI	Upgrade	Buy	Hold
CHINA AUTOMOTIVE SYSTEMS INC	CAAS	Upgrade	Buy	Hold
LIBERTY BANCORP INC	LBCP	Initiated	Sell
Source: TheStreet.com Ratings