SELL Tom.com JP Morgan has downgraded its rating on the stock from 'neutral' to 'underweight' due to its demanding valuation. Tom.com's share price has advanced 43 per cent this year, but analyst Kristian Jhamb said: 'Apart from a 'rally-by-association' with the pure-play Chinese portals, we find no fundamental or company-specific news flow underpinning the advance.' Mr Jhamb also widened his net loss expectation for the company by 112 per cent to $104 million for this year in view of the impact of the Sars virus on outdoor advertising and print. The analyst has a valuation for the counter of $2.16 and suggests a re-entry level of less than $1.95. SELL Sun Hung Kai Properties Dao Heng Securities has lowered its rating on the developer from 'buy' to 'reduce', saying the present valuation is to 'rich' given Hong Kong's dwindling property market. The brokerage said: 'Earnings risk of Sun Hung Kai Properties is definitely on the downside because property prices are still heading south due to excessive supply.' The brokerage has, therefore, revised downwards its profits forecasts for SHKP by 8.2 per cent to $3.297 a share this year and by 11.6 per cent to $3.034 next year. Dao Heng is also concerned about a possible dividend cut due to negative earnings growth. It has a price target of $35 on the stock. HOLD Bank of East Asia Core Pacific-Yamaichi has raised its earnings forecasts by 3 per cent this year but has maintained its 'hold' rating on the bank, saying its share price reflects the strong earnings growth achieved this year. Analyst Bonnie Lai said cost-cutting would be the earnings driver for the bank this year. She projects the bank's earnings will grow 25.6 per cent to $26.5 a share this year and 8.2 per cent to $1.215 next year. Bank of East Asia lifted its dividend payout ratio from 48.3 per cent in 2001 to 62.2 per cent last year. '[It] could maintain the ratio at about 70 per cent,' Ms Lai said.