The Day's Winners

Lear

(LEA) - Get Report

tacked on 2% to $38.96 a day after reporting a rise in quarterly earnings and boosting its full-year forecast. The auto parts supplier earned $85.5 million, or $1.27 a share, in the quarter, up from $44.9 million, or 69 cents a share, in the year-ago period. Analysts had been expecting $1.18 a share. Sales were up to $3.79 billion from $3.61 billion, due mainly to strong North American auto production. Lear also raised its guidance for the full year. Prudential raised its rating on the stock to buy from hold, and Standard & Poor's revised its outlook on the company's debt to positive from stable.

Credit rating company

Moody's

(MCO) - Get Report

added 7% to $45.70 after topping the consensus earnings estimate and raising its full-year guidance. The company earned 49 cents a share, up from 34 cents a year ago and 9 cents ahead of the consensus estimate. Moody's said low interest rates spurred growth in mortgage and loan refinancing, leading to its better than expected results. The company expects to earn $1.65 to $1.78 a share for the year, up from an earlier forecast of $1.54 to $1.57.

Nutritional supplement maker

NBTY

(NBTY)

added 3% to $14.31 thanks to stronger third-quarter earnings. The company said its profits were $20 million, or 30 cents a share, up from $13 million, or 20 cents a share, last year. Including a $15 million settlement, the company earned $30 million, or 44 cents a share. Sales were up to $252 million from $204 million. The company said all divisions generated substantial sales increases in the quarter.

Taro Pharmaceuticals

(TARO) - Get Report

moved up 5% to $26.05 after the company reported a second-quarter profit increase. The generic drugmaker earned $10.2 million, or 35 cents a share, up from $6.1 million, or 24 cents a share, a year ago. Analysts had been looking for 32 cents. Sales increased to $49.6 million from $36.4 million.

Shares of

Yum! Brands

(YUM) - Get Report

, formerly Tricon Global, climbed 8% to $25.76 on a Merrill Lynch upgrade before the company's earnings release later Tuesday. Merrill moved its rating on Yum!, which operates KFC, Pizza Hut, Taco Bell and Long John Silver's fast food restaurants, to near-term buy from neutral due to the company's valuation. Merrill believes Yum! will benefit from the weak dollar, and the firm expects an increase in guidance after earnings are released. Merrill set a new price target of $29 on the stock.

The Day's Losers

Dynegy

(DYN)

fell 57% to $1.44 after a slew of bad news converged to knock the energy merchant to an all-time low. Dynegy reduced its 2002 cash flow outlook to $600 million from $700 million, blaming market conditions putting pressure on the company's liquidity. Standard & Poor's cut the company's credit rating to junk with a negative outlook, with an analyst at the ratings agency saying that Dynegy's financial plan "has not provided the level of sustainable cash flow necessary for investment-grade status." Additionally, Banc of America and Salomon Smith Barney downgraded the stock.

Online travel reservation company

Expedia

(EXPE) - Get Report

shed 6% to $51.51 on a downgrade ahead of the company's earnings release. CE Unterberg Towbin cut its rating on Expedia to market perform from buy on valuation concerns. The firm also believes that Expedia will lower its third-quarter transaction revenue guidance after it reports second-quarter results after the market closes Tuesday. Towbin said the elimination of travel agency commissions from major airlines and the rough air travel environment will hurt the company's results.

Shares of

Flowserve

(FLS) - Get Report

plunged 38% to $14.35 after the company posted disappointing second-quarter results and said its full-year earnings would miss estimates. The pump and valve maker earned 28 cents a share in the quarter, compared with 7 cents a share a year ago. Excluding special charges relating to an acquisition and unfavorable currency translation, Flowserve earned 46 cents a share, missing the consensus estimate by a penny. The company forecast earnings of 38 cents to 43 cents a share for the third quarter and $1.70 to $1.90 for the year, compared with Wall Street's estimates of 55 cents and $2.12, respectively.

Neoforma

(NEOF)

dropped about 22% to $8.35 on several downgrades in the wake of accounting concerns. On Monday, the healthcare information technology company said it was meeting with auditors and federal regulators to review a past accounting treatment applied to stock grants. Neoforma said it might restate its results going back to the third quarter of 2000, leading to Tuesday's downgrades. WR Hambrecht cut its rating on the stock to buy from strong buy, saying risk averse investors should avoid the stock until the uncertainty is eliminated. First Albany and SG Cowen also cut their ratings on the stock to neutral from buy.