However, until then, we would like to remain on the sidelines and await a partnership announcement for one or more of the clinical candidates. Our target price is $1.50, which corresponds to a P/S multiple of 1.6x our estimated revenue of $110.0 million in 2010, discounted back two years using a discount rate of 25 percent. We believe the high discount rate is warranted because commercialization of deCODE's drug candidates is still a few years away.

Upgrading H&R Block to Hold

We are upgrading our rating on shares of H&R Block, Inc. (HRB) from Sell to Hold following the release of Q4 financial results. Although the fallout from the mortgage business implosion will likely be felt for some time to come, and we continue to have significant concerns regarding other aspects of HRB's business, we believe that negative and positive aspects of the company's outlook are now roughly balanced.

Steps have been taken by management to refocus the company on its core tax businesses, and the emphasis on expense reduction should result in improved margins going forward. The Attorney General of Massachusetts has filed suit against HRB. We believe that this suit provides evidence that, while the company has shuttered its origination business and sold its servicing business, the operational difficulties and potential financial fallout resulting from the company's mortgage operations may continue to be a factor going forward.

Given our outlook for future earnings, balanced against our remaining concerns regarding HRB's ongoing business, we consider the shares to be appropriated valued near present levels. Currently, the shares trade at approximately 13.2x our 2009 EPS estimate. We are increasing our six-month target price from $20.00 to $22.00, equating to approximately 13.5x our 2009 earnings estimate.

Equinix Valuation Pretty High

As a leading provider of colocation services, Equinix, Inc. (EQIX) is positioned to benefit from its differentiated position as a neutral colocation provider.  The company's state of the art data centers are located in Tier 1 markets where real estate is in tight supply.  Moreover, increasing power and cooling requirements of today's equipment has made legacy data centers obsolete, improving competitive conditions in the market.

We are positive on EQIX's recurring revenue model and expansion into the European market, which has very favorable characteristics. Equinix is slated to open nine new data centers, including three each in Europe, Asia and the United States. To-date, the company has posted 21 quarters of revenue and EBITDA growth.

However, a high valuation and significant capital expenses to build out its datacenters are causing concern. Equinix competes with Internet data centers operated by established communications carriers. Equinix does still compete in a crowded market, which could become more price competitive.  We maintain a Hold rating on the shares.

Shares of Equinix are currently at a rich P/E multiple of 117.4x our 2008 EPS estimate, which is a large premium to industry median. On a P/S multiple, EQIX is trading at 4.8x our 2008 revenue estimate of $18.78 per share. We set our price target of $94.00, representing a P/S multiple of 5.0x our 2008 revenue estimate, which we believe is achievable for a growing company like EQIX.