Markets & Stocks
Street Talk: Ford cut
August 29, 2000: 3:49 p.m. ET

Dresdner lowers the automaker's rating but PaineWebber maintains a 'buy'
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NEW YORK (CNNfn) - Citing concerns about Ford Motor's credibility after the Firestone tire recall, Dresdner Kleinwort Benson downgraded the automaker's stock to "add" from "buy" Tuesday.

In a note to clients, Dresdner Kleinwort Benson analyst David Garrity said the recall undermines Ford's efforts to place responsibility on Bridgestone/Firestone.

But PaineWebber reiterated a "buy" rating on Ford Motor (F: Research, Estimates) despite a class action suit filed Tuesday against both Ford and Bridgestone (BRDCY: Research, Estimates) regarding the Firestone tire defects. The investment firm believes Firestone will bear the brunt of the liability.

Despite recent concern about the impact of a slowdown in advertising spending at many companies, PaineWebber kept its "buy" rating and $185 price target on Yahoo! (YHOO: Research, Estimates).

Although it expects advertising to be weak over the next six weeks, the brokerage views the leading Internet portal's sell-off as "overdone."

On Monday, Lehman Brothers expressed caution about the company's third-quarter revenue outlook.

Shares of Yahoo! fell 44 cents to $121.63 in late afternoon trade.

Meanwhile, Bear Stearns kept its "buy" rating on American Home Products (AHP: Research, Estimates) after a federal judge on Monday approved a $3.75 billion negotiated settlement that the drug company reached with users of its diet drugs Pondimin and Redux.

Analysts were bullish on two online business-to-business service graphiccompanies. Credit Suisse First Boston said current momentum was strong for VerticalNet (VERT: Research, Estimates). The brokerage noted the Internet content provider's recent joint venture with Japan's Softbank will likely have impressive returns.

And Donaldson, Lufkin & Jenrette initiated coverage of ValiCert (VLCT: Research, Estimates) with a "buy" rating and 12-month price target of $20.

DLJ said the company, which provides e-commerce software that allows companies to conduct e-transactions over the Internet, had a "compelling" valuation.

It forecasted total revenue for 2000 at $11.2 million and 2001 revenue at $24.8 million, an annual growth rate of 121 percent.

ValiCert slipped 44 cents to $13.

In other ratings, S.G. Cowen began coverage of chipmaker Microtune (TUNE: Research, Estimates) with a "strong buy" rating, noting it expects dramatic revenue growth over the next several years. Back to top

--compiled from staff and wire reports


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