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 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.

AMB Property Corporation ( AMB) has been upgraded to a buy from a hold. Its EPS for the second quarter of fiscal year 2007 increased 91.22% over the year-earlier period, continuing a trend of positive EPS growth over the past two years. The company's net income rose 56.95% over the same period, outperforming the S&P 500 but lagging the industry average. AMB's stock price has increased by 7.75% over the last year, and still has good upside potential. AMB had been rated a hold since June 2007.

Electro Scientific Industries ( ESIO) makes high-technology manufacturing systems for the global electronics market. It has been upgraded to a buy from a hold. Fiscal fourth-quarter 2007 revenue was up 23.9% on the year, and this growth appears to have trickled down to the company's bottom line. Electro Scientific's earnings per share rose 35% over the same period, continuing a pattern of positive EPS over the past two years. The company's net income increased 33.2% over the same time frame, exceeding both S&P 500 and the industry average. Its share price has grown 29.11% over the last 12 months and still shows upside potential. Electro Scientific had been rated a hold since April 2006.

Beermaker Redhook Ale Brewery ( HOOK) has been downgraded to a hold from a buy. The company shows a mix of strengths and weaknesses. Its net loss per share narrowed in the first quarter of fiscal year 2007 to 4 cents a share from 9 cents a share a year earlier. The total net loss narrowed also to $320,000 from $700,000 a year earlier. On the downside, Redhook's gross profit margin of 17.2% is still rather low, although it is up on the year. The company also had negative operating cash flow of $970,000 during the most recent quarter. It had been rated a buy since June 2007.

International Speedway ( ISCA) hosts racing activities at its Motorsports facilities. It has been downgraded to a hold from a buy. While the company's second-quarter revenue was up 5.5% on the year, it still trailed the industry average of 10.1%. In addition, its net operating cash flow declined 3.72% to $100.1 million over the same period. International Speedway has a debt-to-equity ratio of 0.32, which is beneath that of the industry average and implies successful debt management. It had been rated a buy since April 2007.

Nara Bancorp ( NARA) operates as a holding company for Nara Bank. It has been downgraded to a hold from a buy. The company's first-quarter revenue was up 12.5% on the year, but the increase trailed the industry average of 27.9%. Nara's net operating cash flow increased 27.65% over the same period, and its net profit margin of 16.10% compares favorably to the industry average. However, the company's EPS declined by 6.67% and its stock price has fallen 17.38% over the past year. TheStreet.com Ratings does not currently see anything to suggest a reversal in this one-year trend. Nara had been rated a buy since August 2005.

ATV, snowmobile and motorcycle manufacturer Polaris Industries ( PII) has been upgraded to a buy from a hold. Its stock price has increased by 45.99% over the past 12 months, and should continue to move higher.

Polaris' return on equity improved to 58.69% in the second-quarter of its fiscal 2007, a sign of significant strength within the corporation. Its second quarter EPS was up 17% on the year, and while the company has reported somewhat volatile earnings recently, TheStreet.com Ratings believe it is poised for EPS growth in the coming year. These strengths outweigh the company's generally poor debt management on most measures. Polaris had been rated a hold since April 2007.

Warwick Valley Telephone Co. ( WWVY) provides communication services to residential and business customers. It has been upgraded to a hold from a sell. The company's debt-to-equity of 0.26 is beneath that of the industry average, suggesting very successful management of debt levels, and its quick ratio of 2.31 demonstrates its ability to cover short-term liquidity needs. First-quarter revenue dipped 3.0% over the year-earlier period, a decline that appears to have affected its earnings, which declined 40.9% over the same period. Warwick Valley Telephone has reported a trend of declining EPS over the past two years. It had been rated a hold since June 26, 2007; prior to that, it had been rated a buy since December 2005.

Entertainment products and candy manufacturer The Topps Company ( TOPP) has been upgraded to a buy from a hold. The company's EPS for the first quarter of fiscal year 2008 were up 200% on the year, and it has demonstrated a pattern of positive EPS growth over the past year. The Topps first quarter net income was up 181.9% on the year, and its stock has appreciated by 25.24% in the past 12 months.

The buy rating also takes into account the fact that The Topps is in the middle of a bidding war that enhances its potential value. The company agreed in March to be acquired by a group of private investors for $9.75 per share; rival sports card company Upper Deck subsequently offered a competing bid of $10.75 per share in late June.

Topps has recommended to shareholders that they reject the Upper Deck offer for fears that a potential merger could hit an antitrust snag. The buy rating is based on TheStreet.com Ratings' view that shareholders will vote down both offers in favor of more value, or wait for the possibility of a new bidder. The company had been rated a hold since September 2005.

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