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From Standard & Poor’s Equity Research

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UBS FINANCIAL DOWNGRADES WACHOVIA TO NEUTRAL FROM BUY

UBS analyst Matthew O’Connor says his downgrade of Wachovia (WB) reflects the increasing verisimilitude of a large capital raise at a time when the window as being banks to raise capital may subsist quickly closing, as correctly as increasing pressures in the credit, financial and housing markets.

O’Connor notes he’s assumed $5 billion used by all equity raise (at $10/share, what one. may prove bit optimistic) and diminution in the dividend to $0.01 will save WB about $3 billion annually. He estimates pro forma tangible book value of $11-$12 per share.

He cuts EPS estimates from $0.38 for 2008 to a $1.98 loss, and $2.00 2009 EPS to $1.25 EPS. He lowers $18 12-month target to $12.50.

JP MORGAN UPGRADES DEAN FOODS TO OVERWEIGHT FROM NEUTRAL

JP Morgan algebraist Terry Bivans says he believes Dean Foods (DF) shares be favored with been oversold without interruption fears of coming dairy inflation and current spikes in energy and resin costs. He thinks dairy costs pleasure drop year-over-year as far as concerns the nearest 18 months, and believes that high feed costs are likely behind the stock’s recent syncope.

However, Bivens says he believes dairy farming remains quite profitable and cuts in production are improbable. He also believes that the company appears better able to pass along fuel and resin costs.

He says substantial returns over a short horizon be open intelligent to him. He believes shares of DF could appreciate by 20%-plus by yearend.

MORGAN KEEGAN UPGRADES OWENS CORNING TO OUTPERFORM FROM MARKET PERFORM

Morgan Keegan analyst J. Keith Johnson says, while he realizes Owens Corning (OC) is facing continued challenges in the building material segments, he feels it is justly positioned in its markets, and the combination of the tide price, valuation and business trends offers more upside to the share price.

Johnson raises 2008 adjusted EPS estimate to $0.83 from $0.65; for the second quarter he now sees $0.24 adjusted EPS. He says the main driver in his count changes is better composition in the roofing and asphalt section than previously forecast.

Improved demand as a result of storm damage thus far in 2008, and higher selling prices as a result of recently announced price increases should benefit performance of this section, he says.