I love coupons; who doesn't? They are, arguably, one of the most important marketing tools used by companies such as Procter & Gamble (NYSE: PG), Colgate-Palmolive (NYSE: CL), and General Mills (NYSE: GIS). I also love coupon distribution on the web, so I'm hoping a new technology reported on by BusinessWeek really takes off.

A company called Coupons, Inc. has developed a system dubbed Brandcaster. It essentially follows Google's (NASDAQ: GOOG) model of monetization. Depending on where you are on the web and what you are looking at, the Brandcaster will determine if a coupon may be applicable to you. It will then try to get you to access the coupon and print it up. Web sites who use the application will be given a cut of revenues generated from successful coupon printings. So, speaking hypothetically, if I'm on a site that's dedicated to video games, maybe this Brandcaster thing will someday tell me that I can print up a coupon allowing me to get $5 off a new software title.

If this is promoted properly, and if the value to consumer companies can be adequately communicated, then I think Coupons, Inc. has a hit on its hands. Like I say, people love coupons, and I think they are more likely to act on printing out a coupon then they are to, say, buy a product immediately online through a banner ad. I see this kind of advertising as being more effective over the long-term than other kinds of ads.

But, there's a significant challenge, in my opinion, to Coupons, Inc. and Brandcaster. I'm not sure how it is in all parts of the country, but in my area, there are many businesses, including a major regional supermarket chain, that are either very suspicious of Internet coupons or don't accept them at all. There's a good reason for this that probably goes without saying, but I'll say it anyway: the chance for counterfeit coupons is always there. I think web-coupon distributors are still a long way off from finding quality solutions to the piracy issue (or at least, that's the current perception from where I sit).

Nevertheless, I think this Brandcaster is neat. Companies signed up so far for the program include Kraft (NYSE: KFT), Kimberly-Clark (NYSE: KMB), and Clorox (NYSE: CLX), as well as the aforementioned General Mills. Apparently 200 coupons will be distributed to over 3,000 websites initially, with hopes that the network can grow to over ten times as many websites in a short period of time. I think this has a great chance for success.

Disclosure: I don't own any companies mentioned here; positions can change at any time.

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MOST NOTEWORTHY: Invesco, Kimberly Clark and Crawford & Company were today's noteworthy initiations:

• Jefferies finds Invesco (NYSE: IVZ) compelling given the company's focus on expense control, strong cash flow characteristics, and attractive valuation. Shares were assumed with a Buy rating and $33 target.
  
• Caris started Kimberly Clark (NYSE: KMB) with a Below Average rating and $58 target. The firm believes consensus estimates may be too high given the high cost of commodities.
  
• Suntrust started Crawford & Company (NYSE: CRDB) with a Buy rating and $8 target, and believes the company is at the "front end" of a turnaround in operations.

OTHER INITIATIONS:

• Bernstein initiated Energizer Holdings (NYSE: ENR) with an Outperform rating and $100 target.
  
• BMO Capital assumed Range Resources (NYSE: RRC) with an Outperform rating and $85 target.
  
• Intrepid Potash (NYSE: IPI) was started with a Sell rating and $40 target at Soleil.

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This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and check out other Battle of the Brands posts.

In the world of diapers, try as other brands might to gain a foothold, it is really a Pampers vs. Huggies world.

Pampers, made by Procter & Gamble (NYSE: PG) has been the market share winner for decades and is P&G's top global brand. But Huggies, made by Kimberly-Clark (NYSE: KMB) has made significant inroads thanks to frequent discounts.

Consumer Reports estimates parents will spend between $1,500 and $2,000 on disposable diapers before their child is potty trained. With that kind of investment, many parents have strong views about which brand is best. Leakage control and rash prevention are the main criteria. Consumer reports rates Pampers (both its Cruisers and Baby Dry brands) higher than Huggies, mainly due to Pampers' superior leakage prevention.

Baby blogs also seem to favor Pampers over Huggies. And in my experience, I do think of Pampers as the "premium" and was surprised that when I actually checked price tags in my local drug store this week, found that they were priced exactly the same.

For my diaper dollar, I don't see much of a difference between the two. I'm all for changing the baby more often and buying a cheaper diaper. If you really put the diapers to the test with, say an eight-hour day at the playground without a change, you might find a difference. But my priority is to spend as little time and money diaper shopping as possible. Costco stocks Huggies in bulk, so that's what we have now.

These days, on a run to the drugstore, I might be inspired by Pampers new "one-pack = one vaccine" campaign with UNICEF to vaccinate women (protecting their newborns as well) against tetanus. Now through August, P&G will give 5 cents per package or an estimated $2 million (read more about "cause marketing" programs like this one).

On polling a few of my diapering pro friends, I was told of one pediatrician who recommended switching to Pampers to help resolve rash issues. Bloggingstocks colleague Jonathan Berr says his family has come to favor Huggies brand for their overnights and swim diapers, but Pampers for everything else. For anyone serious about their diapering choices, that sounds like good advice to me.

Vote in our poll for Huggies or Pampers as your preferred brand, and let us know in the comments why you love it.

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• AFLAC Inc. (NYSE: AFL) reported better-than-expected earnings for the first quarter.
• Ambac Financial Group Inc. (NYSE: ABK) posted a wider-than-expected loss; shares hit new low.
• Amdocs Ltd. (NYSE: DOX) beat Q2 estimates on strength in the managed services businesses.
• Amphenol Corp. (NYSE: APH) beat expectations in the first quarter and raised its guidance.
• Amylin Pharmaceuticals Inc. (NASDAQ: AMLN) posted a larger-than-estimated Q1 loss.
• Aptar Group Inc. (NYSE: ATR) posted record Q1 results and raised its Q2 guidance.
• Bank of America (NYSE: BAC) Q1 earnings plunged on further housing-related write-downs.
• Brinker International Inc. (NYSE: EAT) narrowly beat earnings expectations on cost cutting.
• Bristol-Myers Squibb Co. (NYSE: BMY) beat analysts' estimates for the first quarter.
• Credit Suisse Group (NYSE: CS) reported a wider-than-forecast loss on subprime-related write-downs.
• Cree Inc. (NYSE: CREE) earnings slipped while revenues soared 29%.
• Eli Lilly & Co. (NYSE: LLY) reported worse-than-expected Q1 earnings on discontinued product charge.
• Gannet Inc. (NYSE: GCI) beat low expectations as earnings and revenue continue slump.
• Hasbro Inc. (NYSE: HAS) posted better-than-expected Q1 earnings on international strength.
• JAKKS Pacific Inc. (NASDAQ: JAKK) missed Q1 expectations on restructuring and litigation costs.
• Kimberly-Clark Corp. (NYSE: KMB) beat EPS estimates by a penny, as revenue jumped 10%.

• Lufkin Industries (NASDAQ: LUFK) beat analysts' expectations and raised its Q2 guidance.
• Manpower Inc. (NYSE: MAN) beat Q1 earnings expectations on strength in Europe.
• Mattel Inc. (NYSE: MAT) swung to a loss in Q1 on gross margin pressures.
• Merck & Co. (NYSE: MRK) Q1 profit nearly doubled on a one-time payment from a partner.
• Philip Morris International Inc. (NYSE: PM) posted solid results on new products and the weak dollar.
• Schering-Plough Corp. (NYSE: SGP) Q1 profit plunged but still beat analysts' expectations.
• UnitedHealth Inc. (NYSE: UNH) lowered its 2008 outlook after missing Q1 earnings estimates.
• Western Union Co. (NYSE: WU) posted strong results on exchange rates and strength overseas.

Also, Jim Cramer discusses "crummy lenders" and Joseph Lazzaro considers Citigroup Inc. (NYSE: C) as a barometer of the economy. One analyst thinks financials may have hit bottom and it may be time to buy, and Jon Ogg looks at what short sellers are making of tech stocks. Ted Allrich discusses what to sell/what to buy.

Upcoming results to watch for include Verizon Communications (NYSE: VZ), Tyson Foods (NYSE: TSN), CBS Corp. (NYSE: CBS), Countrywide Financial (NYSE: CFC), U.S. Steel Corp. (NYSE: X), Office Depot (NYSE: ODP), General Motors (NYSE: GM), Procter & Gamble (NYSE: PG), Kraft Foods (NYSE: KFT), Starbucks (NASDAQ: SBUX), Time Warner (NYSE: TWX), Comcast (NASDAQ: CMCSA), Exxon Mobil (NYSE: XOM), and Chevron (NYSE: CVX).

Visit AOL Money & Finance for more earnings coverage.

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Kimberly-Clark (NYSE: KMB) reported for the first quarter today. Net sales increased almost 10% to $4.8 billion. Adjusted earnings per share increased 5% to $1.08. That's a rather small jump, granted, but you know something, it was enough to keep the stock in the green (at the time of this writing, at least) instead of in the red on a day when the major market averages -- and just about all of the stocks in my personal portfolios -- are bathing in the evil crimson color of doom. And according to Briefing.com, Kimberly-Clark played the beat-the-expectations game and won by the proverbial penny! Shareholders should be pleased.

A non-pleasing item to be found in the release centers on cash from operations -- it decreased by about $100 million to $426 million due to changes in working capital. That doesn't concern me so much right now, though, since Kimberly-Clark will probably do well over the coming years in terms of cash generation. The company, by the way, has been repurchasing stock, so management seems pleased with the shares as a potential investment idea.

Kimberly-Clark, which is a consumer-products business in the league of entities such as Procter & Gamble (NYSE: PG), Energizer (NYSE: ENR), Colgate-Palmolive (NYSE: CL), and Unilever (NYSE: UL), could be a value right now based on its P/E ratio and dividend yield. Out of the stocks mentioned here, I like P&G the best, but I do respect Kimberly-Clark -- in fact, it was mentioned recently in an article by Steven Halpern that centered on an analyst's picks for quality and yield.

Disclosure: I don't own shares in any of the companies mentioned; positions can change at any time.

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Investment Quality Trends -- one of the most respected newsletters in the advisory field -- uses a proprietary strategy that assesses historic level of stock price to yield; it's goal is to buy those stocks offering the best potential for downside protection and upside appreciation.

Here, editor Kelley Wright explains his methodology and highlights his current "Timely Ten" stocks that best match his time-tested criteria.

"Investors who wished to hold every stock in that we currently rank in the 'Undervalued and Rising Trend' categories, would need to hold one hundred twenty six stocks as of March; clearly too many positions to be practical.

"Our Timely Ten, therefore, is our reasoned expectation based on our methodology and experience for what we believe will perform best over the next five years.

"Do we believe that all 10 will go up simultaneously or immediately? Of course not. Our four decades of research and experience, however, leads us to believe that these stocks, purchased at current Undervalued levels, are well positioned for appreciation.

"Whether you are looking to build a portfolio from scratch, are partially invested and looking to add new positions, or fully invested and in need of some affirmation and hand holding, the Timely Ten represents our top ten recommendations as of each issue.

"The Timely Ten consists of Undervalued stocks that generally have a S&P Dividend & Earnings Quality rating of A- or better, exemplary long-term dividend growth, and a P/E ratio of 15 or less.

"These stocks also generally show a payout ratio of 50% or less (75% for Utilities), debt of 50% or less (75% for Utilities), and technical characteristics on the daily and weekly charts that suggests the potential for imminent capital appreciation."

Here are Investment Quality Trend's most current "Timely Ten" and their respective dividend yields:

General Electric (NYSE: GE) - yield 3.4%
PepsiCo (NYSE: PEP) - yield 2.1%
McDonald's (NYSE: MCD) - yield 2.7%
Rohm & Haas (NYSE: ROH) - yield 2.7%
Johnson & Johnson (NYSE: JNJ) - yield 2.6%
Wal-Mart Stores (NYSE: WMT) - yield 1.8%
Kimberly Clark (NYSE: KMB) - yield 3.6%
Wells Fargo (NYSE: WFC) - yield 4.1%
Jack Henry (NASDAQ: JKHY) - yield 1.2%
Bank of America (NYSE: BAC) - yield 6.6%

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.

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MOST NOTEWORTHY:

• Piper downgraded shares of Corinthian Colleges (NASDAQ: COCO) to Neutral from Buy as they expect the company to face difficulty maintaining Title IV lending at its high default rate schools.
  
• Jefferies downgraded shares of MSC Industrial (NYSE: MSM) to Hold from Buy on valuation, as there is not enough upside to their $50 target to maintain a Buy rating
  
• Credit Suisse lowered HBOS Plc (OTC: HBOOY) to Underperform from Neutral to reflect the weakening housing and mortgage environment.

OTHER DOWNGRADES:

• Salesforce.com (NYSE: CRM) was cut to Market Perform from Outperform at Bernstein.
  
• B. Riley lowered Iomega (NYSE: IOM) to Neutral from Buy.
  
• Goldman downgraded Bare Escentuals (NASDAQ: BARE) and Procter & Gamble (NYSE: PG) to Neutral from Buy and Kimberly-Clark Corp. (NYSE: KMB) to Sell from Neutral.

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Zebra Technologies (NASDAQ: ZBRA) provides printers, supplies and software used to produce bar codes, text and graphics on labels, cards, receipts, tickets and tags. It also makes EPC-compatible radio frequency identification (RFID) smart label printers/encoders for firms required to comply with major retail and government mandates. The company's products are used by businesses and governments in over 100 countries around the world, including more than 90% of the firms in the Fortune 500. Major clients include AMR Corporation (NYSE: AMR), Caterpillar (NYSE: CAT) and Kimberly-Clark (NYSE: KMB).

The Street was surprised late last month, when the company reported Q4 EPS of 45 cents and revenues of $233.6 million. Analysts had been looking for 43 cents and $226 million. Management also guided Q1 EPS to 36-44 cents (42 cent consensus) and Q1 revenues to $238-$255 million ($232.78M consensus). The Board authorized the purchase of an additional three million common shares.

The stock popped into a bullish "flag" consolidation pattern on the news. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the issue with two "strong buys", two "buys" and two "holds". Analysts expect a 16% average annual growth rate, through the next five years. The ZBRA Price to Book ratio (2.49), Price to Free Cash Flow ratio (17.15), Net Profit Margin (12.68%) and Return on Assets (11.03%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 95% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $27.50 and $42.50. A stop-loss of $28.70 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in any of the stocks mentioned above.

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MOST NOTEWORTHY:

• Jefferies upgraded shares of ICF International (NASDAQ: ICFI) to Buy from Hold on valuation to reflect the company's accelerating core business momentum and upped Road Home funding.
  
• Citigroup raised its rating on General Mills (NYSE: GIS) and Kellogg (NYSE: K) to Buy from Hold on valuation, as they believe food consumption stocks are recession proof.
  
• Bear Stearns upgraded shares of Caterpillar (NYSE: CAT) to Outperform from Peer Perform as they believe the company will benefit from the interest rate cuts.

• Merck (NYSE: MRK) was raised to Buy from Neutral at UBS.
  
• El Paso (NYSE: EP) was upgraded to Overweight from Equal Weight at Morgan Stanley.
  
• Lehman raised Kimberly Clark (NYSE: KMB) to Overweight from Equal Weight.

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The earnings crunch is in full swing, and here are a few of the highlights of this past week's earnings coverage from BloggingStocks:

• AT&T Inc. (NYSE: T) only met earnings expectations despite strong holiday iPhone sales.
• Bank of America (NYSE: BAC) earnings plunged 95% due to mortgage-related write-downs.
• Delta Air Lines Inc. (NYSE: DAL) narrowed its fourth quarter loss and beat expectations.
• eBay Inc. (NADSAQ: EBAY) beat low expectations, but the CEO is to step down in March.
• EI DuPont de Nemours & Co. (NYSE: DD) beat earnings expectations even thought profits fell 37%.
• E*Trade Financial Corp. (NASDAQ: ETFC), posted a bigger-than-estimated fourth quarter loss.
• Fifth Third Bancorp. (NASDAQ: FITB) missed estimates on acquistion costs and a one-time charge.
• Ford Motor Co. (NYSE: F) missed low expectations, prompting further domestic cost reductions.
• Harley-Davidson Inc. (NYSE: HOG) profit declined on weak domestic sales.
• Hershey Co. (NYSE: HSY) profit sank due to rising costs, competition, and management shakeups.
• Honeywell Internationl Inc. (NYSE: HON) only met estimates, despite growth in all business segments.
• Kimberly-Clark Corp. (NYSE: KMB) profit slipped bet met expectations, due to increased paper costs.
• Lennar Corp. (NYSE: LEN) reported a record quarterly loss due to the housing slump.
• Motorola Inc. (NYSE: MOT) profit plunged due to loss of market share, and it forcasts a first quarter loss.
• National City Corp. (NYSE: NCC) posted a bigger-than-expected loss, but shares rose anyway.
• Pfizer Inc. (NYSE: PFE) profit plunged, but beat estimates, due to increased competition for generics.
• UAL Corp. (NASDAQ: UAUA) narrowed its loss despite rising fuel prices and holiday cancellations.
• Wachovia Corp. (NYSE: WB) earnings plunged 98% due to home loan write-downs.
• WellPoint Inc. (NYSE: WLP) met earnings expectations and reaffirmed its 2008 outlook.

See additional earnings highlights.

Also, Jim Cramer's advice for what earnings should mean in your buy or sell decision. Both Peter Cohan and Georges Yared look at the part earnings have played in this week's volatility. And Aaron Katsman is bullish on tech stocks.

Upcoming results to watch for include Verizon (NYSE: VZ), Halliburton (NYSE: HAL), American Express (NYSE: AXP), McDonald's (NYSE: MCD), Yahoo! (NASDAQ: YHOO), Amazon.com (NASDAQ: AMZN), Starbucks (NASDAQ: SBUX), Altria (NYSE: MO), Boeing (NYSE: BA), United Parcel Service (NYSE: UPS), Procter & Gamble (NYSE: PG), Google (NASDAQ: GOOG) and Exxon Mobil (NYSE: XOM).

Visit AOL Money & Finance for more earnings coverage.

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Among Thursday's quarterly reports were those of Lennar Corp. (NYSE: LEN), Kimberly-Clark Corp. (NYSE: KMB), and E*Trade Financial Corp. (NASDAQ: ETFC), all of which had disappointing news for investors.

One of the nation's largest homebuilders, Lennar, reported a $1.25 billion loss in the fourth quarter -- its largest ever -- as the housing slump drove prices lower and the builder took hefty charges. Lennar also reported a $1.9 billion loss for all of 2007. The Miami-based company said it was aggressively trying generate cash and lower inventory.

Quarterly losses rose to $7.92 per share, from $195.6 million, or $1.24 per share, a year ago. Revenue fell 49% percent to $2.18 billion from $4.27 billion in the same period of 2006, as both home deliveries and new orders fell 50%. The results topped the consensus forcast of analysts surveyed by Thomson Financial, who had expected a loss of $1.65 per share on revenue of $2.06 billion (these estimates typically exclude one-time charges such as land write-downs).

For the year ending November 30, Lennar's losses come to $12.31 per share, compared with profits of $593.9 million, or $3.69 per share, in 2006. Shares closed up 8.5%, to $16.21.

Kimberly-Clark reported that fourth-quarter profits slipped 5.5% as higher materials costs offset a 10.5% increase in revenue. The company earned $456 million, or $1.07 per share, in the fourth quarter, down from $482.6 million, or $1.05 per share a year earlier. Excluding restructuring charges, the company would have earned $1.11 per share, which met the expectations of analysts surveyed by Thomson Financial. Revenue rose to $4.76 billion, beating analysts' prediction of $4.65 billion, partly due to favorable currency exchanges.

For all of 2007, Kimberly-Clark earned $1.82 billion, or $4.09 per share, on sales of $18.27. That compared to 2006 earnings of $1.50 billion, or $3.25 per share, on $16.75 billion in sales. For all of 2008, Kimberly-Clark expects to earn $4.45 to $4.60 per share. Analysts had expected $4.60 per share. Kimberly-Clark said it will continue to boost per-share profit by buying back its own stock. Shares were down only a penny at the close, $64.43.

E*Trade posted a hefty loss for the fourth quarter because the struggling discount brokerage had dumped a book of risky investments at a steep discount. E*Trade lost $1.71 billion, or $3.98 per share, compared to a profit of $176.7 million, or 40 cents per share, in the fourth quarter of 2006. Analysts polled by Thomson Financial had expected a smaller loss of $2.90 per share. E-Trade's revenue for the quarter was negative $2.01 billion, compared to revenue of $628.8 million in the year-earlier quarter. Analysts expected revenue of negative $1.1 billion.

E-Trade lost $1.4 billion, or $3.40 cents per share, for the year in 2007, compared with profit of $628.9 million, or $1.49 per share, in 2006. Shares ended Thursday at $3.48, up just two cents from the open.

Visit AOL Money & Finance for more earnings coverage.

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MOST NOTEWORTHY:

• Banc of America upgraded shares of Deere (NYSE: DE) to Buy from Neutral and raised their target to $186 from $130 as they expect upside in 2008 from favorable global agriculture fundamentals.
  
• Wachovia raised its rating on Boeing (NYSE: BA) to Outperform from Market Perform citing favorable risk/reward as domestic economic concerns and 787 development risks are discounted in valuation.
  
• Air France (NYSE: AKH) was upgraded to Buy from Hold at Citigroup, as they believe the company's joint venture with Delta Air Lines (NYSE: DAL) will boost margins.

• Baird upgraded OmniVision (NASDAQ: OVTI) to Neutral from Underperform.
  
• Deutsche Bank upgraded Philips Electronics (NYSE: PHG) to Buy from Hold.
  
• Tidewater (NYSE: TDW) was upgraded to Buy from Hold at Jefferies.
  
• Lehman raised Kimberly Clark (NYSE: KMB) to Equal Weight from Underweight.

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Optical bar codes are on most of the products we buy in stores these days, and there is a firm in Vernon Hills, Illinois, that is a leader in making the machines that create the codes. The same company also provides the machines that make the radio frequency labels that are replacing barcodes.

Zebra Technologies (NASDAQ: ZBRA) provides printers, supplies and software used to produce bar codes, text and graphics on labels, cards, receipts, tickets and tags. It also makes EPC-compatible radio frequency identification (RFID) smart label printers/encoders for firms required to comply with major retail and government mandates. The company's products are used by businesses and governments in 100 countries around the world, including ninety percent of the firms in the Fortune 500. Major clients include AMR Corporation (NYSE: AMR), Caterpillar (NYSE: CAT) and Kimberly-Clark (NYSE: KMB).

Investors were pleased earlier in the week, when the firm reported Q3 EPS of 43 cents and revenues of $217.2 million. Analysts had been looking for 38 cents and $213.3 million. Management also guided Q4 EPS to 38-45 cents (43 cent consensus) and Q4 revenues to $215-$227 million ($228.62M consensus). The stock popped on the news and then passed into a bullish "pennant" consolidation pattern. Prices frequently exit pennants moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Brokers recommend the issue with two "strong buys," two "buys" and four "holds." Analysts expect an eighteen percent growth rate, through the next year. The ZBRA Price to Book ratio (2.75), Price to Free Cash Flow ratio (19.08), Sales Growth rate (16.54%), Net Profit Margin (11.93%) and Return on Assets (9.95%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 95 percent of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $32.93 and $42.50. A stop-loss of $32.25 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.

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MOST NOTEWORTHY: The Personal Care, Household Products and Cosmetics industry, Horsehead Holdings and China Sunergy were today's noteworthy initiations:

• Wachovia initiated coverage of the HPC industry with an Overweight rating, starting shares of Avon Products Incorporated (NYSE: AVP), The Procter & Gamble Company (NYSE: PG) and Kimberly-Clark Corporation (NYSE: KMB) with Outperform ratings and The Clorox Company (NYSE: CLX) and The Estee Lauder Companies Inc (NYSE: EL) with Market Perform ratings.
• CIBC started shares of Horsehead Holdings (NASDAQ: ZINC) with a Sector Outperformer rating and $30 target, as they believe the valuation discount to other North American zinc producers will narrow as investors become more aware of the name.
• Jefferies would avoid shares of China Sunergy Co Ltd (NASDAQ: CSUN) in the near-term as the company resolves issues regarding its access to polysilicon. The firm initiated shares with a Hold rating and $8 target.

• Goldman reinstated LSI Corporation (NYSE: LSI) with a Neutral rating and $8 target.
• ThinkEquity initiated Advanced Analogic Technologies Incorporated (NASDAQ: AATI) with a Buy rating and $15 target.
• Deutsche Bank resumed coverage of Spirit Aerosystems Holdings Inc (NYSE: SPR) with a Hold rating and $36 target.

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Chesapeake Energy Corporation (NYSE: CHK) implied volatility up on gas price movement and expected fund raising.

CHK is the largest independent and third largest overall producer of natural gas in the U.S. Bloomberg reports Natural Gas Futures are up .88% to 5.63. CHK has a market cap of $15 billion with long-term debt of $8.3 billion. CHK announced on 8/8/07 a $500 million issuance of convertible senior notes (convertible debts increases volatility). CHK filed to sell EUR $525 million in senior notes on 11/27/06. CHK filed to sell $792 million in senior notes on 12/1/06. CHK filed to sell 30 million shares in a secondary on 12/7/06. CHK October option implied volatility of 33 was above its 26-week average of 28 according to Track Data, suggesting larger price risk.

Kimberly-Clark Corporation (NYSE: KMB) implied volatility flat; KMB has low debt to equity ratio.

1.3 billion people, nearly a quarter of the world's population, use KMB brands every day. KMB is recently down 98 cents to $68.42. KMB has a market cap of $29 billion with long term debt of $3 billion. KMB reported 2006 revenue of $16.7 billion. KMB has been frequently mentioned as an LBO candidate in 2006. KMB option implied volatility of 18 was near its 26-week average according to Track Data, suggesting non-directional risks.

Daily options update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

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When you are in the industrial supply business, the competition is ubiquitous and differentiating yourself presents a particular challenge. There is a firm in in Melville, New York that solves the problem by stocking over a half a million products and guaranteeing same day shipment.

MSC Industrial Direct Co. (NYSE: MSM) markets a range of industrial products that includes cutting tools, measuring instruments, tooling components, fasteners, plumbing supplies, electrical supplies, flat stock, raw materials, abrasives, hand tools and power tools. Suppliers include 3M (NYSE: MMM), Black & Decker (NYSE: BDK), Dow Chemical (NYSE: DOW), Eaton Corporation (NYSE: ETN), Goodyear Tire & Rubber (NYSE: GT), Honeywell International (NYSE: HON) and Kimberly-Clark (NYSE: KMB). The company serves nearly 350,000 customers, via a master catalog, supplemental publications, telemarketing and the internet.

The firm surprised the Street late last month, when it reported solid Q3 numbers and guided Q4 estimates above consensus Street views. The share price popped on the news and has since been consolidating the gain in a bullish "pennant" pattern. Prices frequently exit pennants moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Brokers recommend the issue with four "strong buys," three "buys," one "hold" and one "sell." Analysts see an 18% average annual growth rate, through the next five years. The MSM Sales Growth rate (32.27%), EPS Growth rate (26.00%), Return on Assets (17.72%), Return on Investment (20.86%) and Return on Equity (15.57%) compare favorably with industry, sector and S&P 500 averages. Institutions own about 69% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $37.23 and $56.91. A stop-loss of $49.75 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.

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