CHANGE IN RATINGS

Ambac Financial

(ABK)

downgraded at Merrill from Buy to Neutral. The mortgage and housing markets are deteriorating more and faster than previously expected. Estimates also lowered.

American Eagle

(AEO) - Get Report

upgraded at Citigroup from Sell to Hold. $25 price target. Stock has dropped 38% since mid-January, and downside is likely limited from current levels. November sales could show an improvement.

American Eagle initiated at UBS with Neutral rating. Price target starts at $25 with 2008 EPS estimates at $1.83.

Astoria Financial

(AF)

upgraded at Merrill from Neutral to Buy. $30 price target. Valuation appears attractive, and the company is well positioned in a dislocated secondary mortgage market.

Abercrombie & Fitch

(ANF) - Get Report

initiated at UBS with Buy rating. Price target starts at $97 with 2008 EPS estimates at $5.19.

Aeropostale

(ARO)

initiated at UBS with Neutral rating. Price target starts at $24 with 2008 EPS estimates at $1.53.

Bed Bath & Beyond

(BBBY) - Get Report

downgraded at Morgan Stanley from overweight to equalweight and removes its $45 price target.

BioMarin

(BMRN) - Get Report

initiated at Jefferies with Buy rating. Price target starts at $33 with 2008 EPS estimates at $0.36.

Cognos

(COGN)

downgraded at CIBC from Outperform to Sector Perform. $54 price target. Rising Canadian dollar is weighing on the company's earnings, and is already pricing in any neat-term takeover premium.

Comstock Resources

(CRK) - Get Report

upgraded at Keybanc from Hold to Buy. $42 price target. Company posted a third straight quarter of solid earnings, and deserves a higher price multiple.

Babcock & Brown

(FLY) - Get Report

initiated at Jefferies with Buy rating. Price target starts at $33 with 2008 EPS estimates at $0.36.

Gap

(GPS) - Get Report

initiated at UBS with Buy rating. Price target starts at $23 with 2008 EPS estimates at $0.97.

Sun Microsystems

(JAVA)

upgraded at Citigroup from Sell to Buy. $7.25 price target. Product line is improving and the company's restructuring will help cut costs. Management is also buying back stock.

Sun Microsystems 2008 estimates raised at Goldman on JAVA to $0.30 from $0.24 based on strong gross margins and operating expense discipline. Product gross margin came in almost 400 basis points above last year. Maintained Neutral rating and $6.50 target.

J.Crew

(JCG)

initiated at UBS with Neutral rating. Price target starts at $40 with 2008 EPS estimates at $1.44.

Nordstrom

(JWN) - Get Report

downgraded at Morgan Stanley from equalweight to underweight and moves price target to $29.

Mastercard

(MA) - Get Report

upgraded at Deutsche from Hold to Buy. $250 price target. Company's margin potential is not fully realized in the current consensus analyst estimates.

Millennium Pharma

(MLNM)

upgraded at Cowen to Outperform. Company has more potential earnings leverage than the market is giving it credit. Velcade sales also remain strong, despite rising competition.

Oracle

(ORCL) - Get Report

upgraded at Goldman Sachs to a Buy rating from its previous 'not rated' designation. Consolidation strategy has given company an expansive product set with greater account control and cross-selling opportunities. See 20% earnings growth and note that analyst meeting next week should be a catalyst for shares. Price target at $27.

Unum

(UNM) - Get Report

upgraded at Merrill from Sell to Neutral. Estimates also raised, as the company has the excess capital to make buybacks.

STOCK COMMENTS / EPS CHANGES

American Standard

(ASD)

price target raised at Goldman to $40 from $37 based on heightened expectations for takeout. Model now incorporates a 75% probability that company is bought. Maintain Neutral rating based on recent strength in stock, suggesting scenario is already priced in.

Activision

(ATVI) - Get Report

2008 estimates increased at Goldman to $0.75 from $0.70. Solid Q2 results and expectations for Guitar Hero 3 and Call of Duty 4 indicate that shares remain attractive. Note potential for positive earnings revisions and multiple expansion. Maintained Buy rating and price target at $26.