Calls of Note Part 7

- Baird is cautious on Sandisk (NASDAQ:SNDK) saying very recent datapoints about NAND flash contract pricing suggest pricing declines below expectation. While this information is still anecdotal and is in contrast with large orders they believe Apple placed a month ago, they will follow up with more details as soon as possible. Given the mixed datapoints regarding NAND flash supply/demand outlook near-term, the firm retains Neutral rating on SNDK shares.

Notablecalls: Mixed emotions about this one. But I do think SNDK will see some downside. Maybe even today.

Calls of Note Part 6

- Piper Jaffray is cautious on Powerwave Tech (NASDAQ:PWAV) noting that based on their channel checks, they believe North American capital spending improved during the June quarter, but the rate of improvement was slower than they had anticipated.

Given Powerwave's exposure to the Americas (37% of 2005 sales), they have reduced their June quarter estimates below consensus. Firm's checks indicate steady capital spending improvement during Q2 levels from leading North American wireless carriers, but they believe the pace of improvement is slower than equipment vendors may have anticipated. Firm believes most carriers will meet capital spending goals during 2006, but they expect a more back-half-weighted year than normal seasonal trends,particularly for Cingular. Maintains Outperform but lowers tgt to $15 from $16.

Notablecalls: I don't expect PWAV to see much pressure following the call.

Calls of Note Part 5

Several firms are cautious on Palm (NASDAQ:PALM) following in-line results and disappointing guidance issued last night:

* Piper notes they were disappointed with management's FYQ107 guidance of revenue in the range of $380M-$385M and proforma EPS between $0.18-$0.19 vs. estimates of $412M and $0.23.

The lower-than-expected August quarter guidance was driven in part by the end of Treo 650 shipments into the European market starting on June 30, 2006, due to noncompliance with a regulatory issue, and firm's belief the Treo 700 for Europe is launching later than they anticipated. Management also indicated a longer-than-expected sales cycle with enterprise customers and competitive product launches from other major OEMs also impacted near-term guidance.

While Palm guided FY07 year-over-year revenue growth of 20%-25%, they remain cautious of competition impacting ASPs and have modeled 18% revenue growth for FY2007 and 13% revenue growth for FY2008. Maintains Market Perform and $19 tgt.

* Citigroup is lowering their tgt on PALM to $17 from $21. The price target of $17 is based on a P/E multiple of 18.5x CY07 EPS estimate (including stock option expenses) of $0.90 (versus prior estimate of $1.12). Firm believes a P/E-based approach better captures investors' focus on earnings. Maintains Hold.

* Bear Stearns notes that despite PALM's optimistic FY07 outlook underpinned by significant ramp in FY2H07, they are maintaining their pre-options estimates and Underperform rating given concerns about intensifying competition and potential ASP compression.

While PALM's positive FY07 outlook implies a robust FY2H07 growth driven by new product launches and Europe expansion, they are concerned that 1) smartphone market is becoming more crowded with lower-priced smartphones and 2) PALM faces challenges in Europe including entrenched competitors (NOK E61 and Samsung i320 are already ramping) and Treo brand is less known. As for valuation, theyare maintaining 2006 year-end fair value of $14-$15, which is based on sum-of-the-parts valuation.

Notablecalls: Not actionable but good to know category.

Calls of Note Part 4

- Merrill Lynch is somewhat cautious on Medmmune (NASDAQ:MEDI) saying that although the CDC committee's recommendation for use of Merck's cervical cancer vaccine (Gardasil), improving MEDI's royalty revenue outlook from that drug, they believe the market is underestimating the negative impact of newly issued Synagis guidelines on sales.

Newly issued Synagis guidelines were clearly designed to limit use in 32-35 week preterm infants, which represent about 50% of sales. Smoking was eliminated as a risk factor, which we estimate will reduce eligible 32-35 week infants by 50%, but actual decline in use may be less. Also, new guidelines restrict Synagis doses per season to 5, which could adversely impact sales by an additional 1%.

Lower Synagis revenues more than offset higher Gardasil royalties, so firm's '06 EPS estimate falls to $0.22 from $0.32, '07 falls to $0.75 from $0.87, and '08 falls to $0.94 from $1.20.
Maintains NEUTRAL rating due to a break-up value of $35.

Notablecalls: I would not be surprised to see some pressure in MEDI.

- Cowen & Co comments on Tessera Tech (NASDAQ:TSRA) saying we are approaching a critical court event that will give the co a huge boost if TSRA prevails. On Aug 14, TSRA begins a 10 day jury trial to determine if Micron and Infineon are in violation of 4 key TSRA patents. If TSRA wins, they will add 25%+ share to the 40% of the DRAM industry they already cover (DDRII royalties) with Samsung & Hynix.

Firm further surmises that there are high probability incremental licensees (Freescale, Phillips etc.) who will wait for the trial outcome before signing with TSRA. Additionally, a TSRA win would significantly increase the odds of a successful resolution in its Jan 2008 case vs. Spansion, ST, & various Subcons. A win wouldbe huge given this likely ripple effect. Given the strong precedent (Sharp, TI, Samsung) they think the odds of a win are high (80%+?) and believe speculative investors ought to position to take advantage.

Notablecalls: Not actionable but good to know category.

Calls of Note Part 3

- Stifel Nicolaus & Co comments on EMC (NYSE:EMC) after the co announced its intent to acquire RSA in an all cash deal valued at $2.1 billion or $28 per share. Firm believes the premium paid looks very expensive and frankly excessive when looking at premium, EV-to-revenue, and EV-to-EBITDA. Based on our discounted cash flow analysis, the takeout valuation implies that RSA will have to grow operating cash flow in excess of 27% over the next few years, which seems aggressive. Clearly, this was a competitive bidding process and based on comments on the conference call they suspect Symantec and potentially HP could have also been involved.
Expects EMC shareholders to scratch their heads with respect to price paid and strategic fit. Synergies between EMC's business and RSA are not very apparent.

This may or may not spark a run on other authentication players and there is no one with the size and scale of RSA. Other key players in the sector would include Vasco Data Security (VDSI), Secure Computing (SCUR), Aladdin (ALDN) and ActivIdentity (ACTI).

Notablecalls: Not actionable but good to know category.

- RBC Capital says their channel checks on Secure Computing (NASDAQ:SCUR) thusfar have indicated that the co should come in towards the mid-point of their Q2 revenue/EPS guidance of $43-$45M/ $0.10-$0.12 vs RBC of $44M/$0.10. Strength in the quarter appears to be driven by sales of SecureWire, Webwasher, SnapGear and general strength across the core Secure businesses.

With $1.65 in cash and roughly $2.00 in allowable tax affected NOL ($3.00 in total NOL), investors are currently paying less than $4.50 for the enterprise, which is a bargain in firm's mind. Maintains Outperform rating and $14 price target.

Notablecalls: Traders should keep SCUR on their radars over the next week or so.

Calls of Note Part 2

- Baird views Cephalon (NASDAQ:CEPH)'s announcement of an approvable letter for Fentora (FEBT) as a significant positive for two important reasons: First, it demonstrates that Fentora is approvable and has a clear path to approval, critical because CEPH must replace Actiq before it faces generic competition later in 2006. Second, because final approval is pushed back by 3+ months, it allows CEPH to maximize the harvest of Actiq revenues before triggering the start of generic competition.

Recall Fentora is the successor product to Actiq and that Barr Labs is permitted by contract to launch a generic Actiq on 12/06/06, or upon approval of Fentora (i.e., approval of Fentora automatically triggers earlier entry of Barr's generic Actiq). Maintains Outperform and $75 tgt.

Notablecalls: Not actionable but good to know category.

- Citigroup says Avon Products (NYSE:AVP) remains firm's Top Pick in the HPC space. With the stock having come under pressure over the last month (attributable they believe to not only general market malaise but also growing investor concerns that weakness in emerging markets could pressure Avon's growth in coming quarters), the firm believes the stock again represents a terrific value for investors. Indeed, with Avon trading at roughly 16x 2007 EPS estimate, which they think has considerable room for upside, Avon is now one of the cheaper names in the HPC group (with PG at 17x, CL at 19x, CLX at 18x, and EL at 17x).

Given their belief that the combination of top line growth, margin expansion, and the contribution from either a share buyback or debt repayment will drive healthy double digit earnings growth in 2007, they believe the stock is undervalued. Reiterates Buy rating and $36 price target.

Notablecalls: One to watch today. May have some upside in it.

- Stifel Nicolaus & Co expects shares of several beverage companies to trade up on earnings releases in coming weeks. Contributing factors are mostly reasonable valuations, by firm's estimates, and expected earnings upside versus Street consensus (COT, BUD, TAP). In-line to better than expected beer revenues and increasing commodity cost relief are expected to be major contributors to anticipated earnings and trading upside. U.S. beer shipments and pricing expected to produce upside for BUD.

Notablecalls: Charts of COT and BUD look OK.

Calls of Note Part 1

Several firms are commenting on Apple Computer (NASDAQ:AAPL) this morning in light of "irregularities" regarding the issuance of stock option grants between 1997-2001 and reports of weakening iPod demand.

* Merrill Lynch notes that of the total number of options granted (adjusted for splits) to named executives, they find that 5% of options were granted at a share price that was less than 5% from the fiscal year low. Firm finds that 9% of option grants were less than 10% from the fiscal year low. These appear to be a small percent of overall executive option grants.

However, excluding options granted to Steve Jobs (which were priced at levels far above the fiscal year low), 15% of options were granted at a share price that was less than 5% from the fiscal year low and 24% of options were granted at a share price less than 10% from the fiscal year low. Perhaps these are the grants that may have triggered the internal investigation. Maintains Neutral rating.

* Piper Jaffray notes that of the 13 distinct option grants to senior management that were reported from FY97-FY01, they find one grant issued to Steve Jobs to be noteworthy. The firm has seen several other companies in their coverage space that have had options grants within 5% of, or at the low price for, the 40 days surrounding the grant date. From a high level, backdating options is the topic du jour, and this somewhat tarnishes Apple's squeaky clean image. However, it does not impact Apple's underlying fundamentals. They would view a pullback in shares as a buying opportunity ahead of what they believe will be favorable back-to-school and holiday periods for Apple.

* Banc of America is lowering their target price from $77 to $68, based on a lower target multiple. Firm believe thats Apple's transition from an iPod story to more balanced CPU and iPod story presents incremental risks. Based on channel checks and proprietary work, they have lowered iPod forecast and raised CPU growth rate estimates. Net firm's estimates increase by a small amount, from $2.38 in FY07 to $2.43. Believes that Apple's valuation is reasonable, but not on sale. Further, given their belief that street estimates remain in a range of reasonable to too high, they chosse to remain Neutral.

* Thomas Weisel Partners notes they just completed a round of 20 channel checks with Apple specialist resellers and Apple retail stores across the United States, and 90% of checks suggest strong demand for Intel-based Macs. Firm's checks suggest that half of the people visiting the stores are switchers and that there is pretty strong demand for MacBook and low-end MacBook Pro. Checks also indicate that most of the stores have received the shipments of Intel-based notebooks, so from a supply point of view, Apple is in a strong position from last quarter.

According to their checks, iPod nano remains a dominant MP3 player. Video iPod demand also appears to be solid, and this is perhaps due to the fact that customers who are looking for higher capacity iPods have no choice but to buy video iPod. Seventy percent of checks also indicate that overall demand for iPod has fallen off compared to the March quarter, however.
No change to ests. Maintains Peer Perform.

Notablecalls: I don't see AAPL getting hit more than 1-2 pts on this options related issue. The weakness is iPods is alread well known.

Notablecalls - paperstand

According to The Wall Street Journals “Heard on the Street” column, NYSE (NYX), via Euronext, aims to regain its appeal for international listings. Many international co’s that have listed their shares in European and Asian markets don't want to subject themselves to tougher US regulations recently put in place, particularly Sarbanes-Oxley.

According to the Barron’s Online, Alberto-Culver (ACV) appears undervalued. Wall Street pros who crunched the numbers say the co's consumer-products division and its two retail chains are more valuable as separate entities, and should grow faster on their own. "The spinoff frees up two very different businesses," says Mariann Montagne Kotas, of Thrivent Asset Mgmt. "We were already expecting the co's earnings to grow. But the spinoff will remove challenges facing both businesses."

Notablecalls: It’s Friday, nothing actionable.

Calls of Note Part 5

- ThinkEquity negative on WebEx Communications (NASDAQ:WEBX)saying they remain concerned about future pricing, primarily around two trends. First is the convergence of IP communications infrastructure and services, which the firm believes will commoditize stand-alone applications. Second, they have noticed a trend toward more on-premise deployments, which feature all-you-can-eat pricing. As a point of reference, they recently heard that Microsoft is pricing Live Meeting as low as $15/user/year, or roughly $1.25 per month. Firm reiterates Sell rating and $25 price target on WEBX, a multiple of 18x FY'06 EPS estimate of $1.38.

Notablecalls: I think this will prove to be an actionable call. But maybe not today. Give it a week or so.

Calls of Note Part 4

- RBC Capital is raising their Q2 sales and EPS estimates for Gilead Sciences (NASDAQ:GILD) . Firm's new EPS is $0.59 (excludes $0.05 of option expenses) up from $0.56. They believe EPS outperformance is likely to be primarily driven by 1) strong volume growth for Truvada, 2) price increases across the HIV franchise, and 3) favorable currency. Although they believe the company is tracking ahead of FY06 guidance, they do not believe management is likely to raise HIV guidance until the launch of the triple-pill in Q3.

Firm increases Q2 forecast HIV sales to $464M from $441M. IMS data suggests an acceleration of q/q Truvada script growth to 15% and only a 1% decline for Viread, compared with 12% Truvada growth and an 8% decline in Viread last quarter. Gilead remains firm's top large-cap idea and they believe fundamentals remain strong. Reits Outperform rating and $73 tgt.

Notablecalls: I think this may be an actionable call.

Calls of Note Part 3

- Jefferies says they view Jabil Circuit (NYSE:JBL)'s $200 million repurchase authorization as a sign that the management believes its stock is undervalued and last quarter's hiccup is not indicative of a longer-term problem at the company.

Jabil maintains a strong balance sheet and exited fiscal 3Q06 with $855 million in cash and total debt of $356 with a debt to capital ratio of 12%. Firm continues to believe investors that can see through Jabil's near-term issues and focus on the company's normalized earnings power have a rare opportunity to buy one of the fastest growing technology companies over the past decade at a discount. Reits Buy and $36 tgt.

Notablecalls: Agree with Jefferies here. Buying JBL at current levels will work.

- Banc of America has an interesting note on Maxim Integrated Products (NASDAQ:MXIM) noting that perhaps no stock within firm's semiconductor universe has witnessed a fall from grace akin to the one Maxim has. To wit, this erstwhile darling of semiconductor investors is trading near its lowest level since Mar '03, and has (in uncharacteristic fashion) underperformed the SOX by 17% since the most recent cyclical trough in 2005.

What ails the stock? Mainly the strategic change in business model to target lower margin-higher growth segments, that has in turn adversely impacted the company's GM model.

The stock is now trading at 12.5x CY07 consensus pro-forma EPS est.(cash adj) or its lowest multiple in nearly 10 years. With Maxim's long-term growth rate set to accelerate - at least modestly - following the increased focus on higher growth businesses - and operating margins set to remain flat near 44% despite the forecasted GM erosion, the firm thinks the current valuation fails to capture their belief that Maxim is set to grow sales and earnings at a 16-18% clip over the foreseeable future. Maintains Buy and $50 tgt.

Notablecalls: Excellent call by BofA. I don't think it's outright actionable but should add MXIM to investor radars.

Calls of Note Part 2

- CIBC is defending Motorola (NYSE:MOT) saying that following several days of meetings with supply chain members in Asia, theyfeel comfortable that the conflicting and inconsistent data points that have recently surfaced do not stand in Motorola's way to deliver a positive quarter with a solid sequential increase in handset volume.

Firm believes MOT's mid and high end handset volume remains solid and unaffected. The low end has seen lower orders, but MOT's new targets still reflect a solid QoQ increase of ~15% and at least a flat to slightly up 3Q06 outlook, which is explained by a refresh cycle of new low-end handsets. Believes 3Q06 will bring more mixed data points from the supply chain and an associated headline risk to MOT. Maintains Sector Outperformer and $30 tgt.

Notablecalls: I don't think the stock has gotten hit enough for this to be an actionable call. So it goes to the not actionable but good to know category.

- JP Morgan notes video rental spending in stores and online increased 11.0% for the week ending June 25, 2006, according to Rentrak data. June is up 9.9% y/y through three of four weeks. This follows May and April rental spending, which finished with 3.4% and 3.7% growth, respectively.

July releases look weak, with corresponding box office down 43% as studios appear to be pushing product back to later in the year. Only five titles that earned more than $10m in box office are currently scheduled for release in July vs. 7 in 2005 and 15 in June 2006.

Notablecalls: Take a look at the action in Movie Gallery (NASDAQ:MOVI) over the past couple days. I don't think the momo players are ready for weak July performance.

- Banc of America is lowering their estimates on optionsXpress Holdings (NASDAQ:OXPS) following meeting with management. Firm also hosted a dinner with Int'l Securities Exchange (NYSE:ISE)'s management.

While higher market volatility has increased institutional options trading, increased uncertainty has led to lower retail activity. Both mgmt teams pointed out that typically retail activity is less volatile vs. institutional. Plus, as OXPS's customer base falls more in the long-term investor camp (vs. 'day-trader' camp), they expect diminished retail activity will prove temporary as market direction becomes clearer & seasonality subsides.

Firm lowers their Q2'06 est. by $0.01 to $0.30, FY'06 to $1.15 (from $1.20), FY'07 to $1.45 (from $1.50) on reduced market volumes & lower account growth. Maintains Buy but lowers tgt to $31 from $36.

Notablecalls: While I think BofA is late with their call on OXPS I'll be keeping an eye on it just in case the stock breaks down once more.

Calls of Note Part 1

- Piper Jaffray comments on Autodesk (NASDAQ:ADSK) saying their early round checks with 12 major Autodesk resellers (9 U.S., 3 Europe) indicate that, with 1 month left in the quarter, Q2 is tracking to be primarily in line with consensus ($0.35 on $446.9m). From a quota perspective, on average, the resellers in our sample expect to finish Q2 at 100% of quota. Based on our previous checks, see table below, 100% of quota from this sample of VARs would suggest a range of in line to 1% revenue upside for the quarter. Maintains Outperform and $47 tgt.

Notablecalls: Note that on June 21 Piper was out with a call on ADSK suggesting the co may be in trouble. The stock is down ~10% since then. I would not be surprised to see a small bounce in the coming days. I would not hold the stock below recent lows, though.

- Merrill Lynch comments on Alexion Pharma (NASDAQ:ALXN) after the co officially discontinued development of pipeline drug pexelizumab yesterday. Merrill notes the value of this drug had been removed from the stock following its most recent failure in November '05, followed by guidance from the company that it would discontinue the study and program, so this news should not impact the stock and does not change valuation.

The primary focus for Alexion remains filing its BLA for Soliris for paroxysmal nocturnal hemoglobinuria (PNH) and continuing pre-marketing educational programs for hematologists to help identify patients ahead of launch. Maintains Buy rating.

Notablecalls: Not actionable but good to know category. Note ALXN traded down as much as 5 pts in after market trading.

- Morgan Stanley reits their Overweight rating on VeriSign (NASDAQ:VRSN) as we head into the back half of 2006 - a seasonally brighter period for the company. Quite simply, in such a challenging time, the visibility and deep-seated position of VeriSign's model makes this a must own name in firm's view. With this quarter its last one facing difficult compares over the lofty Jamba! numbers of last year, VeriSign has positioned its business to take advantage of some of the better security and Internet commerce growth trends in the market.

Notablecalls: Not actionable but good to know category.

Interesting Call of The Day - NMT Medical (NASDAQ:NMTI)

Today's Call of the Day comes from SunTrust Robinson Humphrey's Amit Hazan. Mr. Hazan is positive on NMT Medical (NASDAQ:NMTI) noting the stock is down 55% since the company released MIST I data at the ACC conference in March, and many have simply given up on this story. While both the migraine and stroke opportunities do not carry great visibility today, the firm strongly believes there is enough support (both clinical and from the medical community) to warrant a much higher stock valuation.

NMT's current enterprise value is ~$72M (as NMT had $44.5M in cash as of 1Q), which is now below what St. Jude Medical paid for competitor Velocimed ($74M) in April 2005. However, the differences between NMTI and Velocimed are like night and day.

NMT is the only one to offer a bioresorbable product (approval in Europe in 3Q06). As the firm has said previously, they feel this company is a clear take-out candidate in the next 6-18 months. The average take-out multiple for high growth med-tech names in recent years has been 10-12x TTM sales, but even a conservative 8x multiple yields a potential acquisition value of ~$18 / share (or ~100% premium from current levels). Firm also sees several upcoming catalysts that should change investor sentiment. Among these: 1) NMTI's filing for its bioabsorbale BioSTAR device remains ahead of schedule2) They expect an agreement in the next few months between NMT and the FDA reflecting a change in the primary endpoint for the U.S. MIST II clinical trial from elimination to a reduction in migraine.

Reits Buy and $20 tgt.

Notablecalls: I like this call. The analyst clearly believes NMTI is a bargain at current prices and is sticking his neck out. I only wish the chart was a bit stronger.

Calls of Note Part 6

- Baird notes that Sigma Designs (NASDAQ:SIGM) has been among claimed option backdaters. They reviewed co's 14 option grants over the last 12 fiscal years and found that options were granted four times on the date of the stock price low for that corresponding fiscal year. 10 of the 14 option grants were within 25% of the stock price low for the corresponding fiscal year.

However, firm says that fundamentals remain intact, with strong momentum in IP set-top boxes and portable video players, while digital TVs and HD DVD should act as catalysts later this year. Reits Outperform and $21 price target.

Notablecalls: SIGM shares have taken a big hit in the last 2 sessions, falling over $2. It is tough to go after a falling knife, but positive chatter from Baird combined with 16% short interest could turn into short-term bounce.

Calls of Note Part 5

- Banc of America notes their June survey of real estate agents indicated that housing trends worsened from already-weak levels. Firm now expects a 48% decline in earnings in '07 and a 72% decline in '08 based on the weak trends and our expectations for the future. They continue to see downside in the stocks and would not yet look for value opportunities, despite the weakness.

An even higher percentage of agents noted that the time needed to sell a home increased in June. This 'time to sell' index declined to 14.7 from 16.3 in May and is generally a good leading indicator. Firm thinks this points to further pressure on home prices.

Stocks mentioned in the note include: WCI, SPF, RYL, NVR, PHM, MTH, HOV, DHI and CHCI. I highlight Pulte Homes (NYSE:PHM) that had its target cut to $26 from $32, impying 8.2% downside to target. Maintains Neutral. Firm notes Pulte is unique from its significant penetration in the active adult segment through its 2001 acquisition of Del Webb. However, they expect Pulte's earnings to decline slightly more than its peers due to its large exposure to markets where affordability is stretched.

Notablecalls: It looks like the builders have some more downside in them. I'd keep an eye on PHM today.

Calls of Note Part 4

- Merrill Lynch thinks Microsoft (NASDAQ:MSFT) stock is likely to remain range-bound over next few months. According to the firm investors could still make profits by using a short strangle (sell call options, and sell put options). Annualized returns on the combined premiums are 16.5%. Investors who already own Microsoft stock can use the same short strangle for added income. While options may not be suitable for all investors, other investors may find this strategy profitable over the near-term.

Investors would sell $25.00 call options, and sell $22.50 put options. The combined $1.20 premium provides a 5.2% return (16.5% annualized). This strategy is profitable in the $21.30 to $26.20 range, though the firm would caution that investors are exposed to losses outside this range.

Notablecalls: I must say I have never seen an options strategy highlighted by a broker actually work. Will see how ML fares.

- ThinkEquity says they are hearing that RF Micro Devices (NASDAQ:RFMD) has received sizeable order cancellations in the last month from both Nokia and Motorola. Firm believes that these order cancellations represent approximately 6-7 million units and will primarily impact RFMD's 2H results.

While the firm has previously been and continues to be concerned primarily by a low-end handset inventory glut, they are now hearing that a component build is occurring in the channel that will largely impact CYQ4 results. Firm expects the channel to react by lowering its forecasts to RFICs for late CYQ3 and CYQ4. Target goes to $5 from $7. Maintains SourceofFunds rating.

Notablecalls: I think we will see weakness in RFMD today. Also scroll down and read the JP Morgan note.

Calls of Note Part 3

- JP Morgan notes their checks in the channel indicate Nokia (NYSE:NOK) is pushing out orders for handset components across the Asian handset supply chain. They believe the push outs have been to suppliers of passive components and printed circuit boards (PCBs) by up to 10% of total 2Q06 units.

Following the Nokia push outs, firm's checks now indicate the top four global handset OEMs - Nokia, Motorola, Samsung and LG - (roughly 75% of 1Q06 global handset sales) are either pushing out component orders (MOT and NOK) or missing 2Q06 sales estimates (Samsung and LG). Firm believes the recent rash of negative wireless data points is indicative of either an inventory over-build or weaker than expected demand.

As a result of the Nokia push outs combined with other weakness from Motorola, LG and Samsung, they are concerned on downside risk to estimates for Nokia suppliers such as Texas Instruments (NYSE:TXN) (~10% of C05 sales) and RF Micro Devices (NASDAQ:RFMD) (38% of F06 sales).

Notablecalls: The slowdown in PC segment usually preludes a slowdown in handsets. RFMD and other players with large handset leverage have already gotten hit which suggests that while there may be some additional downside in store, it's likely muted. I wouldn't be surprised to see some weakness in RFMD today, though.

- UBS comments on XM Satellite (NASDAQ:XMSR) noting Toyota and Hyundai to offer XM factory installed in 2007 model year vehicles. Discussions with new-car purchasers indicate "ah-ha" moments (being stuck in traffic, travel to remote area) when consumer realizes value of XM service, which leads to subscription. XM converts roughly 54% of trials to subscription.

XM announces 2Q subscriber numbers before the open on July 6, 2006. UBSe 403k net adds -29% q-q and -38% y-y. Firm believes they are toward the low end of consensus and we could see a relief rally over 400k. However, they remain cautious heading into the 2Q06 sub figure. Maintains Buy and $25 tgt.

Notablecalls: Not actionable but good to know category.

Calls of Note Part 2

- Banc of America is positive on Flextronics International (NASDAQ:FLEX) noting that while there has been some speculation around a new win with MOT, they believe the win is bigger than expected and incremental to FLEX's original target of ~$1+ billion of handheld revenue growth in F2007 - FLEX realized $4.1 billion of handheld revenue in F2006. The new handset program should contribute $500m in F2007 sales and could be $1+ billion, over time. Firm's channel checks indicate that FLEX continues to win new business across multiple end markets.

Firm's new revenue estimates for F07 and F08 are $17.0 billion and $19.3 billion, respectively, up from $16.6 billion and $18.8 billion. They now forecast 10% organic revenue growth for F07 versus prior estimate of 5%. Maintains estimates due to expected margin pressure.

FLEX's stock trades at 11x C07 EPS estimate, versus EMS sector average of 12x and 14x for S&P 500. Firm views current valuation as very attractive. Reiterates Buy rating.

Notablecalls: Not actionable but good to know category.

- Citigroup comments on Telecommunications Equipment space 2Q order conditions were inline through May, but slowed in the first half of June. While orders in the second half of June sharply accelerated, it looks like 2Q sequential order growth was only about 10% compared to seasonally typical 15+%. Firm's contacts report strong activity levels and pipelines with larger, more strategic enterprise projects, and they are upbeat on 2H prospects. However, they are more concerned about the uncertain interest rate and energy price environment and the potential for sustained enterprise order push-outs.

Because of the concerns about CY 2Q conditions and the potential for sustained weakness, they are cutting estimates on four companies -- Avaya (NYSE:AV), Extreme (NASDAQ:EXTR), Foundry (NASDAQ:FDRY), and Juniper (NASDAQJNPR). The firm is also cutting their target price on Foundry and Juniper.

Notablecalls: Not actionable but good to know category. It's hardly a surprise there is a slowdown in telco eq. spending. The only player standing strong remains to be CSCO. Citi notes they believe co's orders are running at 100%-105% of plan.

- Morgan Stanley is defending Wyeth (NYSE:WYE) noting that although the co has not been providing investors with much to get excited about over the last 2 months, they believe the recent pullback in the stock has gotten excessive.

With the stock trading at 12.8x firm's 2007 EPS estimate, an 11% discount to its peers (ex-SGP), they believe this may be an attractive entry point for investors interested in holding a large-cap pharma stock with good near-term earnings visibility.

Notablecalls: Not actionable but good to know category.

Calls of Note Part 1

- UBS is modestly trimming their intermediate growth assumptions for Broadcom (NASDAQ:BRCM) owing to concerns surrounding our belief that MRVL will be able to increase the competitive profile of INTC's mobile XScale business. Firm's more conservative growth assumptions takes BRCM Price Target to $55 from $60.

Firm believes the acquisition gives MRVL greater wireless sales leverage for its increasingly sophisticated offerings in the CE, Wi-Fi, handset, and ARM core product spaces. XScale is used in the MOT Q, PALM Treo, and RIMM BB8700 among other platforms, and offers a natural bridge for incorporating MRVL WiFi solutions in converged 3G and eventual 4G platforms.

Notablecalls: Not actionable but good to know category. UBS should have issued the note yesterday morning!

- Wachovia's Peter J. Bye notes Alcon (NYSE:ACL) stock has been repeatedly battered over the past several months on growing concern that management may have to lower 2006 revenue guidance for ReSTOR. While the firm acquiesced on this point when they resumed coverage with below guidance estimates for this product and expect management will (should) lower 2006 guidance for this product on the Q2 conference call, they still believe that there lies an upward bias to current 2006 company-wide revenue and EPS projections.

They believe the market is being a bit myopic with the singular focus on ReSTOR (a product that in the best case scenario would represent ~5% of revenue in 2010). Alcon has multiple drivers for revenue growth in its IOL franchise including continued conversion to blu blocker, Toric and IQ and long-term drivers in pharma (Japan, Patanase). Thinks current Street estimates for ACL's lens care franchise underestimate the upside from the recall of competitor's MoistureLoc brand as feedback on ACL's OptiFREE Replinish is strong and we believe share gains are sticky. Maintains Outperform and $125-$130 valuation range.

Notablecalls: Peter, I like your call! But I feel you should have waited a bit longer before issuing it. ACL may still warn.

- JP Morgan comments on Satellite Radio noting that in order to gain an anecdotal view of retail sales trends for the crucial June Father's day period (with June driving 40% to 50% of Q2 gross retail unit sales), they called 40+ retailers the week of June 19 in the Circuit City, Best Buy, RadioShack, Wal-Mart, and Target chains. The calls suggest: 1) June sales were slightly disappointing, but in-line with their downwardly revised XM and Sirius estimates and 2) Sirius' retail edge continues to ease. Retains Neutral ratings on both.

Most stores said that XM and Sirius were selling near parity, with Sirius' Howard Stern-driven retail share edge fading, and XM's Major League Baseball content exclusive providing a seasonal lift, along with its new combo satrad/MP3 devices.

Notablecalls: Not actionable but good to know category.

Notablecalls - paperstand

Barron’s Online discusses ACE Ltd. (ACE), which stock is down 14% since late March. Article suggests that the co’s valuation may present a buying opportunity. "The mkt is pricing in a lot more liability than what the co has had to pay out," says Kevin McCloskey, of Federated Stock Trust. "I think it is a good buy here."

Notalecalls: Not actionable.

Dear readers, today I would like to highlight an article from The Wall Street Journal, discussing a real tough hedge-fund guy. Enjoy with Your morning coffee. Click here.

Calls of Note Part 6

Baird notes their outlook on the industrial cycle is fundamentally unchanged as they continue to believe a mid-cycle slowdown is increasingly likely as we move later in the cycle. Firm is lowering their tgts on Watsco, Inc. (NYSE:WSO) and WESCO International (NYSE:WCC) saying they are increasingly concerned with the potential for disappointing guidance in the face of a slowing economy. While 2Q06 performance should generally be in line to better than expected, they feel the likelihood of positive estimate revisions for 2H06 is equally balanced with the likelihood of negative estimate revisions. The price target for WCC goes to $69 from $80. The price target for WSO goes from $69 to $65. Maintains Neutral for both.

Notablecalls: I would watch both WCC and WSO for weakness over the next few weeks.

Calls of Note Part 5

- New York Global Securities notes they have had discussions with four of Baidu's (NASDAQ:BIDU) largest distributors. The news for the company thus far is positive in their opinion, and they reiterate Buy rating. The distributors told the firm they are enjoying healthy q/q revenue growth due to the continued success of Baidu's search engine. As a result, the firm is raising both revenue and EPS estimates to reflect the numbers they are hearing from the field. The bad news is that there continues to be significant conflict between the distributor base and Baidu's own direct salespeople. There also is growing-albeit still relatively small-competition from Yahoo and Google. Believes these two forces are causing an increase in price discounting that will, in time, result in lower revenue growth for Baidu.

Notablecalls: Looks like an actionable call!

Notablecalls - Immtech Pharma (IMM)

Yesterday, Warren Buffett announced that he will donate most of his personal fortune to the Bill and Melinda Gates Foundation, doubling its size and amount of money spent every year. Makes us wonder, is there any listed companies that may benefit from increasing spending?

We have found company named Immtech Pharmaceuticals (IMM), which has mkt cap of $96m (note: short interest stands at 9.5%). Co's first and main drug candidate is pafuramidine maleate, also known as DB289, which is currently in two Ph III clinical trials, one for the treatment of Pneumocystis pneumonia ("PCP") in patients with HIV/AIDS and the other for the treatment of African sleeping sickness (human African trypanosomiasis). The co's treatment of African trypanosomiasis has designated "fast-track" by the FDA. Pafuramidine were discovered and initially evaluated by The University of North Carolina at Chapel Hill (UNC-CH). The co has exclusive worldwide licenses to develop and commercialize compounds discovered and patented by scientists at UNC-CH.

The co's development of pafuramidine for treating African sleeping sickness has been supported financially by a grant to UNC-CH from the Bill and Melinda Gates Foundation. To date, the Foundation has granted to UNC-CH approximately $40m for the development of pafuramidine; pursuant to the Clinical Research Subcontract, Immtech has received approximately $17.3m of such funds. The co plans to submit a NDA to the FDA for accelerated approval of pafuramidine to treat African sleeping sickness, if they meet the designated end points in Ph III pivotal trial.

We believe that the company may benefit from increased spending by the Fundation.

Calls of Note Part 4

- JP Morgan is updating their Yahoo! (NASDAQ:YHOO) estimates for 2Q'06 and F'06 due to: 1) strength in the broader search market, 2) stabilized US market share, and 3) improved monetization. Firm's revised 2Q estimates of $1.140B and $0.12 (up from $1.117B and $0.11) are now slightly ahead of the consensus estimates of $1.138B and $0.11.

Recent conversations with search media buyers, including SEM executives at firm's June 16th conference call, coupled with 3rd party data suggests that Yahoo! may have grown its queries more rapidly than had originally anticipated. Additionally, it appears Yahoo! grew its US queries in-line with the market in 2Q.

Checks also suggest that Yahoo!'s monetization is up 1% to 2% compared to the first quarter. Finally, we believe Yahoo! continues to see strong momentum in graphical advertising.

Notablecalls: Expect to see some interest in YHOO following the call.

- Thomas Weisel Partners comments on NutriSystem (NASDAQ:NTRI) noting the co is expected to report 2Q06 results the week of July 24, 2006. Firm remains comfortable with their above consensus 2Q06 estimates for revenue of $121.8mn and EPS of $0.48 (consensus of $123.5mn and $0.46, guidance of $118-122mn and $0.44-0.46). These estimates assume 156K new customers, a conservative 1.3% decline in CAC (versus an 8.3% decline in 1Q06), and an approximate 160bp y/y decline in G&A expense as a percent of revenue. They believe new customer assumptions may prove conservative and see gross margin as a potential source of incremental leverage.

Firm's five-year DCF analysis supports the current valuation, yielding a current fair value of $75.04, while comparable multiples relative to peers suggest a current fair value of $98.81. Taking the straight average of the two valuation methodologies, they arrive at a current fair value of $86.93.

Notablecalls: Looks like an actionable call!

Calls of Note Part 3

- JP Morgan notes they had hoped that the Dads and Grads season would provide a significant boost to Apple (NASDAQ:AAPL)'s iPod shipments for the June quarter, firm's checks indicate that this was not the case. As a result, they are reducing expectations for the June quarter to 8.01 million units from 8.73 million.

In addition, the company may have to reduce channel sell-in during the September quarter ahead of its expected product refreshes in the fall, and as a result, the firm is reducing September quarter iPod estimates as well. For the September quarter, they are forecasting 8.54 million units, versus 10.7 million previously.

The news on the Mac side of the equation appears far rosier. Firm is raising their overall Mac shipment forecast for the quarter to 1.27 million from 1.24 million. Early indications suggest that the MacBook consumer laptop is a hit, and this could provide some upside to Mac forecasts for the quarter. With the Intel transition nearing completion, they believe Mac share gains will begin to accelerate in the latter part of the calendar year.

For the June quarter, the firm now expects revenues of $4.39 billion down from $4.45 billion. EPS estimate including options remains unchanged at $0.44. Reits Overweight.

Notablecalls: So, iPod revs are declining and Mac sales are not enough to cover the difference? Makes you say hmmm...

- Banc of America is reducing their June Q (and CY06) revenue and EPS estimates on Western Digital (NYSE:WDC) to reflect PC market weakness. June Q rev and EPS are now $1.07B and $0.33 from $1.9B and $0.34. They are also establishing initial CY07 revenue and EPS estimates of ~$5.0B and $1.95 (incl. options).

Firm believes Samsung and Hitachi gained share this quarter, unlike past quarters, limiting WDC's share gains. WDC will end the quarter with 6 weeks of inventory, which is reasonable for this time of year. Believes that higher than 6 weeks would be a problem, for any hard drive player.

Maintains Neutral rating and lowers tgt to $20 from $22.50, or 10x - 11x CY07 EPS of $1.95. Thinks that near-term WDC will be range bound, given the backdrop of the PC market.

Notablecalls: Not actionable but good to know category.

- JP Morgan has an interesting report on Microsoft (NASDAQ:MSFT) where the firm highlights some of the key things that will have to happen for MSFT to drive a recovery in the stock over the next 6-9 months. They think one of the near term catalysts will be the announcement of another cash distribution plan that will likely be accretive to CY07.

In addition to the $50B in cash, cash equivalents and investments on its balance sheet, they estimate MSFT will generate nearly $12B in free cash flow (after dividend payout) in FY07. Firm expects MSFT to announce another repurchase plan near term and believes that the new plan could be in the $20-30B range leaving ample capital for the company's acquisition strategy.

Notablecalls: Not actionable but good to know category. The stock has done nada for 8 yrs. Firing Ballmer would be the 1st real step to recovery.

Calls of Note Part 2

- Merrill Lynch notes that with several flat panel display (FPD) manufacturers slowing production rates and pushing out some capacity spending, they expect a drop in FPD equipment sales in the next several quarters. Firm attempts to quantify the risk to Photon Dynamics (NASDAQ:PHTN) with estimate reductions. With the stock near historical trough valuations, they maintain Neutral rating, recognizing that much of this news is already in the stock. GAAP FY06E (Sept) EPS goes to $0.60 from $0.80 and FY07E to $0.62 from $0.92.

PHTN is trading at 1.6x tangible book value and 0.8x Enterprise Value/ trailing Sales. The average historical trough has been 1.7x tangible book with the lowest point about 1.0x. The EV/Sales trough has been around 1.6x on average and about 1.0x at the lowest point. The low points typically occurred when PHTN was losing money significantly in downturns. Thus, Merrill believes the current valuation already factors in the slowdown.

Notablecalls: Not actionable but good to know category.

- JP Morgan comments on Corel (NASDAQ:CREL) saying concerns over weakness at its largest distribution partner, Dell, and sluggishness by competitor Adobe have weighed on the stock. Firm likes the long-term strategy and waits to see results to determine if macro issues are impacting Corel.

Some comments the firm has gotten back from the channel indicate that Corel has continued to hold its market share this past quarter. Believes this indicates that results should ebb or flow with the overall macro results are for the quarter. The stock is trading at 8.1x FY2006E earnings which is 58% below its peers. The NOL's for Corel are worth roughly $109M. Maintains Neutral.

Notablecalls: Not actionable but good to know category.

- Piper Jaffray continues to be positive on F5 Networks (NASDAQ:FFIV) following recent round of channel checks and conversations with industry contacts. Firm believes the momentum in the application traffic management space remains strong and they are incrementally more comfortable with their June quarter revenue and EPS estimates. Believes a moderate recovery in the government business, a strong ramp from WANJet (Swan Labs acquisition), and relatively solid demand in North America and Europe will benefit F5 in the current quarter. Reiterates Outperform rating and $66 price target on FFIV shares.

Notablecalls: Not actionable but good to know category.

Calls of Note Part 1

- JP Morgan comments on Hewitt Associates (NYSE:HEW) saying they think it is too early to buy the stock despite the recent sell-off (down 24% YTD vs. SandP500 flat). The overhang from the BPO portfolio problems and recent mgmt change announcements outweigh a seemingly attractive FCF profile. Firm is lowering estimates to be well below consensus.

While tempting to look at HEW in three parts (consulting, benefits, BPO), they think it's more appropriate in two (consulting, outsourcing). In firm's view, the implied outsourcing P/E multiple of about 23-25x at the current price, is not cheap.

Maintains Neutral rating as the intrinsic value is probably higher than the current stock price; however, with sentiment low and limited positive catalysts near term, they think out-performance remains in the future.

Notablecalls: Not actionable but good to know category.

- Merrill Lynch notes Sepracor (NASDAQ:SEPR) has traded up recently based in part on increased speculation that the company could be acquired. In firm's view, the recent FDA rejection of NBIX's indiplon tablets (a potential competitor to Lunesta) and PFE's decision to return indiplon rights to NBIX makes a takeout more possible. That said, they believe the stock could pull back if a deal is not announced in the near term. Has Buy rating and $62 target on SEPR as standalone.

Notablecalls: Not actionable but good to know category.

- Bear Stearns comments on Phelps Dodge (NYSE:PD) after the co announced itsintention to buy Inco and Falconbridge in a deal that would create a $56 billion global mining giant. The combined entity would be the #1 producer of nickel, the #2 producer of copper, the #2 producer of molybdenum, the #3 producer of cobalt and a significant producer of zinc. Believes the $900 million in identified synergies should be achievable, and may prove to be conservative.

According to the firm it appears that PD is using its undervalued equity to purchase two companies that are fully valued. While they believe that this deal may prove to be a positive over the long term, PD shares may come under some selling pressure until this deal is resolved. Maintains Outperform on PD.

Notablecalls: Not actionable but good to know category.

Notablecalls - paperstand

According to The Wall Street Journals "Heard on the Street" column, investors that dumping Berkshire Hathaway (BRKA, BRKB) shares may regret the move. For one thing, the prospective selling by the foundations is unlikely to seriously hurt the stock. Just as important, anticipation that Mr. Buffett will at some point no longer be involved in the co has been an increasing concern in recent years and seems fully baked into the stock's price, which is relatively attractive. That gives Berkshire investors a margin of safety to deal with any weakness the selling from charities could create. "In the long term I don't think it would do anything to the stock price," says shareholder Haruki Toyama, of Toyama Capital Mgmt. "It doesn't inherently change the value in the co."

According to the Barron's Online, Six Flag (SIX) nonexecutive Chmn shelled out $3m to boost his holdings in the co's stock. Daniel Snyder purchased 500K shares for about $5.92 per share after the stock plunged more than 26% last Fri following the co's announcement that an EBITDA shortfall may put the amusement-park operator in default of its bank credit agreement. Snyder's purchase last week boosted his holdings to 11.4m shares, or 12.1% of Six Flags' outstanding shares.

Calls of Note Part 7

- Piper Jaffray notes that following recent round of channel checks and conversations with industry contacts, they believe 3D Systems (NASDAQ:TDSC) maybe experiencing softness this quarter (specifically in Europe) and this could result in lower-than-expected revenues and EPS this quarter. Firm is maintaining their Market Perform rating, but have lowered price target from $23 to $19 on TDSC shares.

Notablecalls: Expect to see some pressure. Maybe as much as 1-2 pts.

Calls of Note Part 6

- Piper Jaffray saying that as a result of the momentum in Focus Media (NASDAQ:FMCN)'s business, especially the positive ASP trends and expected ramp-up of the In-Store Network, they are increasing their 2006 and 2007 estimates. 2006 PF EPS estimate go from $1.25 to $1.49, and 2007 PF EPS estimate from $1.78 to $2.28. Firm is increasing their price target from $71 to $80 based on 35x 2007 PF EPS.

Notablecall: Expect to see some interest in FMCN.

Calls of Note Part 5

- Bear Stearns positive on Burlington Northern Santa Fe (NYSE:BNI) following meeting with management saying management was extremely upbeat about the economy, freight demand, pricing, and its ability to continue to meet high single digit demand growth without a major congestion issue.

BNI continues to see strength from its customers across virtually all segments other than lumber where they are seeing a slowdown in the housing market (only about 9% of its rev.) and some excess centerbeam car capacity. Yields remain firm and we believe continue to modestly accelerate. BNI still has roughly 25-30% of its contracts to re-price including about 70% of its coal business.

In the near term they see strong upside. Longer term the firm continues to see strong potential productivity enhancements in each business line, particularly in BNI's core coal and intermodal franchises. Over the next five years about 60% of its yet to be re-priced coal contracts will see a material price increase and begin to pay a fuel surcharge. Maintains Outperform.

Notablecalls: BNI's chart looks good.

- JMP Securities is maintaining their Market Perform rating on Portalplayer (NASDAQ:PLAY) and lowering FY06, FY07 revenue and EPS estimates to account for the continuing lack of visibility in future business with Apple (largest customer accounting for over 90% of revenues in 2005) and a somewhat slower ramp for the Widows Vista notebook secondary display processor market.

For small-cap value investors, the firm notes that PLAY has almost $8.00 per share in cash and has lowered its operating expenses to minimize its cash burn rate. They believe that PLAY may either consolidate with Sigmatel (SGTL) in order to better compete with China-based Actions Semiconductor (ACTS) or it may be a strategic M&A acquisition candidate for players such as Broadcom, NVIDIA, Intel, TXN, etc., seeking an innovative design company with a healthy balance sheet.

Notablecalls: Not actionable but good to know. On the other side - If I were short, I'd want to get out now.

Calls of Note Part 4

- Jefferies says their checks with ODMs and contract manufactures in Asia indicate that Dell may begin shipping desktops based on AMD (NYSE:AMD)'s Athlon processor in the Sept 2006 quarter. These low- end PC desktops will probably be launched in Asia to test the market for these products.

Though this potential desktop at Dell provides a very important psychological win for AMD, the firm believes that the gain should be limited because ultimate success of AMD's products will be decided in the marketplace. The launch of Intels new Conroe CPU in July 2006 closes the performance gap and hence AMD will not have as much of an edge going forward, focus now shifts toward pricing.

Maintains Hold rating and $26 tgt on AMD as they remain cautious on the co in the near-term.

Notablecalls: Not actionable but good to know category.

- FBR says that based on their checks/reported monthly sales/expecting June revenues up 1-3% MOM, they believe Chipmos Tech (NASDAQ:IMOS) is on track to exceed firms' revenue/EPS estimate of $140M/$0.24. Believes the transition to DDR2 remains strong, comprising 35-40% of 2Q DRAM mix, and on track to be >50% by YE. Ratio of IMOS' DDR2/DDRI output is going up quickly, as two primary customers, Promos/Powerchip, have switched over manuf. lines to DDR2 (believes DDR2 now comprises 70% of output at both). Maintains Outperform rating.

Notablecalls: One to watch. While I expect to see some weakness in the Semi space I would not be surprised to see IMOS trading up on the call.

Calls of Note Part 3

- Jefferies continues to be positive on POZEN (NASDAQ:POZN) saying their discussions with investigators at the American Headache Society meeting (June 22-25) confirm their thesis that the FDA's requesting of more safety information could be relatively quickly addressed (e.g., subgroup analyses). Investigators reiterate sound and robust safety data for Trexima (362 patients exposed to Trexima for 12 months vs. the FDA's requirement of 100 patients). In addition, they point out Imitrex and naproxen have been used together safely over the last 10 years and feel that the FDA's decision could have stemmed from its increasingly risk-averse stance as a result of the debacle over withdrawn Vioxx.

Reits Buy rating and $15 tgt.

Notablecalls: I highlighted RBC Capital's positive call on POZN on June 12 and the shares are up about 10% since then. I think Jefferies has a very good point and I expect the shares to keep moving up. It's definitely not a 1-2 day call, though.

- RBC Capital notes an expanding product line and improving execution are taking hold at Radware (NASDAQ:RDWR) but near term metrics remain mixed and they are reducing their estimates. Specifically, North America trends remain below plan and the firm estimate overall revenues are now tracking flat sequentially vs. most expectations of 5% sequential growth. And while they remain encouraged by new products such as the Application Switch V and improving sales initiatives in the U.S., they are lowering growth trajectory for the balance of the year.

Radware recently upgraded its management team in North America and thus far the company is making steady improvements. However, the ramp in sales is occurring at a slower than expected pace. Eexpect no change in gross margins near term at approximately 81%. Operating loss near term is expected at 1%. Balance sheet metrics remain strong and the company has over $8.50 in cash and continues to generate cash.

Tgt goes to $17 from $19. Maintains Outperform as the shares are trading at just 8x CY07 earnings estimate if one excludes the cash.

Notablecalls: Not actionable but good to know category.

- Raymond James is raising their 2Q ($2.91 to $3.01) and FY06 EPS estimates for the Chicago Mercantile Exchange (NYSE:CME) due to strong average daily contract volume thus far in June. Additionally, a stronger mix of both equity trading and electronic vs. open outcry trading should result in a higher rate per contract (RPC) than we were forecasting. The Merc is also generating nice momentum already in its NYMEX volumes, which will add slightly to 2Q, but have a noticeable impact on revenues during the remainder of the year.
Maintains Outperform and $520 tgt.

Notablecalls: Note that Sandler O'Neill upped their ests on CME already on June 19. But the chart does look great.

Calls of Note Part 2

- Citigroup's Semiconductor Equipment team follows up their TSMC pushouts note saying it appears these pushouts represent ~10% of Applied Material (NASDAQ:AMAT)'s FQ3:06 shipments. This suggests FQ4:06 (Oct) revs will be hit ~6-7% (adjusting for svc and FPD (which, they note, is also weaker)).

Checks also confirm LRCX's ~100% IBM etch share at 90nm now 75% (at best) at 65nm due to TEL, consistent with firm's view of intensifying competition for LRCX with potential implications at partners (CHRT, AMD, Samsung, Toshiba).

TSMC pushouts an impt first step to curb overcapacity, but they feel it's still too early to take a more broadly + view pending more broad pushouts/capitulation.

Notablecalls: 6-7% hit to revs sounds pretty serious. Expect some more weakness in the Semi/Semi Equipment space.

- Citigroup says they have analyzed the recent IMS Health weekly total prescription trends and conclude that CV Therapeutics (NASDAQ:CVTX)' Ranexa is off to a slower-than-anticipated launch. Based on discussions with physicians, they believe that this is due to the drug's high price, modest benefit, and low awareness.

Reduces FY2007 Ranexa sales estimates from $169 million to $74 million to account for this trend. Since they do not see any meaningful catalysts to drive appreciation in the stock until release of data from the MERLIN study in early 2007, the firm expects that the stock will remain weak over the near-term and will be volatile in $10-$16 range. Reduces target price from $27 to $16. Maintains Hold.

Notablecalls: Looking at the chart I must say I think Citi is terribly late with their call. Piper Jaffray downgraded the shares and lowered their tgt to $13 already on June 15.

- Bear Stearns notes that following a 10%-25% selloff in the peer group since May 1, Powerwave's acquisition of Filtronic's filter and power amplifier divisions, and ADC Telecom's pending acquisition of Andrew, GrenTech (NASDAQ:GRRF) is still trading at a significant (20%-50%) discount to local and global industry peers on a 2006E P/E basis.

GrenTech is exposed to China 3G licensing in both of its markets (wireless coverage and RF modules), both of which will expand dramatically when licenses are issued. Firm maintains their view that China's 3G licenses will be issued in 1H07, after the completion of China's TD-SCDMA commercial network trials. Adjusts 06/07 EPS estimates to reflect the view.

Firm's YE2006 tgt of $19.80 implies a 2007E P/E of 13.3x. Estimates GrenTech's current net cash per share at $2.25. Maintains Outperform.

Notablecalls: I think this one could prove to be a runner if it can break the $12-$12.5 level.

Calls of Note Part 1

- Jefferies is calling DUSA Pharm (NASDAQ:DUSA) extremely undervalued saying they would be buyers of the stock at current levels. Firm expects DUSA to report solid 2Q results (to be released on August 8th). They believe there is solid upside to their revenue and EPS estimates of $6.4 million and ($0.10) respectively. Notes Stiefel and DUSA are in discussions to extend their current Brazilian distribution agreement into one for all of Europe. Believes the expanded distribution deal should provide upside to current estimates, as it will likely be announced in 2H06.

Thinks the current stock price has fallen well below the company's core value, and expects the stock to recover on improving adoption trends. Reits Buy and $13 tgt.

Notablecalls: Huge target for a $4 stock. Would not be surprised to see some interest in shares.

- FBR positive on ASML Holding (NASDAQ:ASML) noting that following the co's May-23 announcement that 2Q system bookings will be at least 40% higher QOQ, or at least 87 units, they were expecting 3Q bookings to decline to 55- 62 units, or in line with 4Q05/1Q06 levels. However, recent checks in U.S./Japan suggests that 3Q bookings could actually exceed expectations, driven by increasing lead times/continued share gain.

Firm reminds investors that ASML's 1-2-3 punch, capacity buy/technology upgrade/share gain, has enabled it to report better than expected system bookings. To that end, ASML, like no other capital equipment company, is expected to ride out any "lull" in system bookings in 3Q/4Q time frame. Reiterates Outperform rating going into SemiconWest (July 11-14)/2Q report (with estimates expected to be revised up).

Notablecalls: Not actionable but good to know category.

- Banc of America comments on General Motors (NYSE:GM) saying they can't help but read what is going on in GM's business as a liquidity tactic. Firm estimates GM is raising price at least 1% in 2006 to capitalize on market inelasticity (1% price equates to 2% volume) and shore up margins. However, they believe GM management is glossing over the current and future cost of rightsizing the business for the lower share.

Sees GM burning its final precious dollars and raising prices just to try to stop the burn. The math may work in the short term and especially in 2Q06 where inventory was built, but after 2Q06 production begins to fall. Then, they think the stock market will have a hard time seeing how else GM can stop the cash burn. Maintains Sell and $10 tgt.

Notablecalls: Not actionable but good to know category.

- Citigroup is adding Apple Computer (NASDAQ:AAPL), McDonald's (NYSE:MCD), and Alltel (NYSE:AT) to firm's Recommended List:

* The addition of Apple derives from firm's view that recent share price weakness has presented an attractive entry point into a high quality technology/consumer products company that we believe has a strong fundamental context (given its exposure to the continued digitization of entertainment) and is likely to continue taking market share in the PC business. Wile number of product transitions will likely limit Apple's ability to deliver upside to June quarter EPS estimates, the firm believes that this has been priced into the stock and that the potential for upside surprises to consensus numbers will return in the calendar third quarter.

* The decision to add McDonald's is driven by a different rationale. In firm's commentary on the state of the broader market, they have noted that they think that a shift in leadership away from small caps, emerging markets, and natural resource driven names is underway. Firm has suggested that new leadership might be found in "large cap and large cash" rather than any one particular sector or industry group. McDonald's, which is among the top 20% of S&P 500 names by market cap and has strong free cash flow, fits this theme very well.

* Notes the addition of Alltel is more of a housekeeping matter as the firm upgraded Telecom Services sector on April 13, 2006 and needs to keep their Recommended List as a rough reflection of their recommended sector weights.

Notablecalls: Not actionable but good to know category.

Notablecalls - paperstand

According to The Wall Street Journals "Heard on the Street" column, pet stocks, like VCA Antech (WOOF) and Idexx (IDXX), can endure tough mkts. This year, veterinary spending is expected to grow 7.9%, making up about 1/4 of the projected $38.4bn in total pet-industry spending. Over the past 30y, vet spending has been rising at about 6.6% a year, more than double the growth rates of GDP and general consumer expenditures, according to research by Ryan Daniels, of William Blair. Spending on pet medical care "is less discretionary than general consumer spending," says Mr. Daniels, who covers specialty health-care co's and cites the animal health-care sector as among his favorites.

The WSJ reports, citing ppl familiar with the matter, that Johnson & Johnson (JNJ) last night appeared close to purchasing a stable of household consumer brands from Pfizer (PFE) for about $16bn. Other suitors include Reckitt Benckiser and GlaxoSmithKline (GSK).

According to the NY Times, Phelps Dodge (PD) agreed to acquire two of the biggest nickel miners last night in a huge deal worth $40bn. The deal, for Inco (N) and Falconbridge (FAL), would create a mining behemoth that will reshape the industry as commodity prices continue to soar.

Notablecalls - paperstand - Barron's

According to the Barron’s, at 9 and change, Playboy (PLA) trades near its 1971 offering price. Some fans think it could be worth more than $20 a share.

After years of stellar returns, Fidelity National (FNF) stumbled. But one analyst sees the potential for 20%-plus gains for both its new insurance and new tech shares (Fidelity National Information Services (FIS)) in the next 12 months.

According to the Barron’s, supply and demand conditions in the market have deteriorated sharply, especially in the past month. The Dow Jones Industrials may fall another 15% before it's time to buy.

Sara Lee’s (SLE) stock has fallen more than 10% this year, while rivals have posted modest gains. And, says Barron’s, with a possible dividend cut ahead, the shares could well drop another 15%-20%.

According to the Barrons’ “Technology Trader” column Bernstein analyst Richard Evans thinks Pfizer (PFE) stock could instantly attract value investors once its managers stop spending so much in search of growth. Pfizer shares have been so beaten down, that 4 they trade at barely 11x this year's earnings. Yet the drug giant has more than $15bn in cash. If Pfizer greatly increased its share buybacks, or boosted its already plush dividend, the stock could rise to the high twenties.

Notablecalls: As PLA is only playable call from this week's magazine, it's poised for a nice gain.

Dear Notablecalls reader, if You have a minute, I would recommend reading Barrons’ cover story along with morning coffee. Click here.

Calls of Note Part 2

- Banc of America notes their channel checks indicate that several of Taiwan Semiconductor Manufacturing Company Ltd (NYSE:TSM) top customers are pulling down second half 2006 wafer start forecasts and/or pushing out starts. Firm is cutting our estimates to reflect a more modest seasonal build in the second half of 2006.

The big question is whether these modest cuts morph into a more serious problem. Inventory trends and second half demand will be the key data points to monitor. The breadth of the adjustments across the customer base does suggest a trend. Firm's FY06 revenue estimate is cut from $10.1 to $9.8 billion.

Checks suggest that TSM has pushed out AMAT's CMP tools for Fab 14 (300mm) from 4QFY06 to 1QFY07. Firm expects the rest of the process tool push-outs (PVD, CVD, etc) to follow suit

Notablecalls: This should not come as a surprise to Semi bears. However it is likely a surprise for the bulls...

- Citigroup says their checks suggest Taiwan Semiconductor Manufacturing Company Ltd (NYSE:TSM) has begun to push out tool deliveries with a large portion of 300mm tool shipments in backlog scheduled for July-Oct now pushed out by ~1Q. At this point, pushouts appear limited to 300mm w/200mm on-track. This is a change from checks conducted late last week indicating no industry pushouts had occurred. At this point, Taiwan pushouts appear limited to TSMC as UMC + 2nd tier Taiwan DRAM customers remain on-track. TSMC exposure greatest at AMAT, AEIS (derivative), LRCX, MTSN, NVLS.

According to the firm, while memory spending remains strong, pushouts from TSMC weakens the argument for a tool order re-acceleration in 2H:06.

Notablecalls: This should not come as a surprise to Semi bears. However it is likely a surprise for the bulls. I think the Semi bounce stops here.

Calls of Note Part 1

- Jefferies & Co notes that based upon their checks, they believe that Sigmatel (NASDAQ:SGTL) is on track to meet its rev guidance for Q2. Although Q1 was significantly impacted by a likely overshipment in Q4:05, they believe that the low level of customer orders in Q1 allowed SGTL's customers to reduce inventory to more normalized levels and return to ordering in Q2. Firm believes only modest Q/Q increases from its largest MP3 customers will likely allow SigmaTel to achieve the low end of its guidance.

Although they are encouraged about the likely improvement in Q2 fundamentals, the firm remains neutral as they believe risks remain regarding: 1) cash burn and liquidity issues, 2) the signifcant business ramp in 2H:06, and 3) the lack of material traction for its Oasis and Protocom. Maintains Hold and $4.

Notablecalls: Expect the note to create some interest in SGTL. It's been a while since the co has met their guidance or analyst ets.

- Goldman notes that based on the results of our 22nd qtrly study across all key metrics (listings, conversion, ASP, etc), they estimate eBay (NASDAQ:EBAY) will grow rev at least 30% y/y, inline with firm's above-consensus 2Q06 rev/EPS est's of $1,415m/$0.24.

Firm believes eBay's current 2007E P/E multiple implies that eBay's EPS growth rate from 2007-2010 will be 12%-15% (dividing the 2007 P/E by the PEG range of 1.5x-2.0x, the range that growth companies still trade at, in addition to its 14x 2007E EV/EBITDA multiple), well below their estimated 20%-25%.

What will get the stock to work? eBay's multiple contraction despite unchanged estimates, which occurred last spring/summer as well, is a result of several factors including the increased complexity in analyzing the business given the changing seller behavior and mix that leaves investors unsure of its growth rate. In order for the shares to appreciate significantly, investor perception of eBay's long-term growth must improve. We believe that eBay's ability to continue to beat its outlook and meet or beat Street estimates as it has for the last several quarters is the best way to eliminate the uncertainty in its perceived growth rate. Reits Outperform.

Notablecalls: Not actionable but good to know category.

- Goldman is adding Focus Media (NASDAQ:FMCN) to their CIL* as they believe it: 1) is less exposed to negative economic factors; 2) has a demonstrated ability to exceed earnings expectations by growing organically and through M&A; 3) reduction in the previous share offering overhang. Expects Focus to deliver 2Q2006 results at the high end of its guidance range. Tgt is raised to $78 from $76 per ADR.

* Goldman Sachs' Current Investment List (CIL) represents firm's most timely stock recommendations for total return over the next 12 months.

Notablecalls: I would not be surprised to see some interest in FMCN today.

Interesting Call of The Day - Kintera (NASDAQ:KNTA)

Roth Capital's Nathan Schneiderman notes that over the past month, Kintera (NASDAQ:KNTA) insiders have been loading up on company stock; of note, Director Alfred Berkeley purchased 100k shares in late May at an average price of $1.40. While some of the other insider buying may have been symbolic, he thinks that Mr. Berkeley is buying for one reason and one reason only-to make $$$.

Firm is optimistic about Kintera's prospects for revenue growth and much sharper cost controls. They expect that new COO Rich LaBarbera will work closely with CFO Dick Davidson to hack away at the company's bloated cost structure. If need be, they think that Kintera could cut headcount in half. Furthermore, there is ample room for non-resource expense savings.

While it's certainly tempting to conclude that a stock in freefall is going to zero, the beauty of enterprise software companies with healthy recurring revenue is that it's damn near impossible to kill them off. They estimate that Kintera's 2006 recurring revenue will be $30 million, up nearly 20% y/ y. In firm's view, the current valuation of 1x recurring revenue (not total rev) will not last for long. Notes there have been takeouts of struggling vendors in the space at multiples of recurring revenue; for example, the current offer price on Onyx Software is more than 3x recurring revenue. In firm's experience, it is nearly impossible to kill an enterprise software company that has healthy recurring revenue and that should give Kintera investors considerable downside protection.

As Kintera executes, tey envision the stock rebounding nicely and thus maintain BUY rating and price target of $2.25, reflecting a multiple of 1x 2007E sales.

Notablecalls: KNTA looks like to be a deep-value idea. Some risk but lots of upside. One to watch.

Calls of Note Part 4

- Baird reduces their price tgt on Hutchinson Technology (NASDAQ:HTCH) to $24 from $29 based on 13x C07E EPS and 4x EV/C07E EBITDA, a more reasonable valuation they feel in light of current industry weakness, increasing inventories, and the possibility of a challenging quarter (per industry contacts).

Maintains Neutral rating as the firm believes HTCH enjoys a solid industry leadership position, and has significantly higher earnings power in the model if the company can ramp gross margins to historic levels of 28% or more (current GM guidance is for 19-21%).

Notablecalls: Would not be surprised to see some weakness following Baird's call and weakness in XRTX.

- First Albany reits their Strong Buy rating on PainCare Holdings (AMEX:PRZ) following results. According to the firm the co reported strong 1Q:06 results, suggesting that business trends continue to be robust, notwithstanding recent non-cash accounting restatements.

Given current market conditions, they are making no change to their $3.00 price target at this time, as it implies 75% upside potential from current trading levels. However, the target represents what they view as a reasonable 14x current- year EPS estimate of $0.21, suggesting that the shares are undervalued relative to PRZ's underlying fundamentals and near-term growth prospects.

Notablecalls: Not actionable but good to know category.

- Piper Jaffray positive on Deckers Outdoor (NASDAQ:DECK) after meeting with Angel Martinez (CEO) and Zohar Ziv (CFO) who detailed growth strategies and financial objectives for the company's three brands. Management reaffirmed its commitment to 42%-44% gross margin and stabilization of expenses in the low-20% of sales. Firm believes product innovation and marketing initiatives are taking hold, leading to increased confidence in growth and view that estimates (and guidance) are appropriately conservative.

Firm estimates core underlying EPS growth in the mid- to upper-teens and views their 2H FY06 estimates as conservative given product development initiatives. At 13.7x FY07E EPS, DECK share are trading at a 20% discount to estimated FY07 EPS growth, in line with the footwear peer group mean, despite significantly higher operating margins (near 20% vs. group avg near 12%).

Notablecalls: Not actionable but good to know category.

Xyratex (NASDAQ:XRTX) - Color on quarter

Couple of firms commenting on Xyratex (NASDAQ:XRTX) today following results:

*Banc of America notes XRTX reported stronger than expected revs with EPS below their estimates. However, the stock was up 8%+ heading into the call, and they believe investors were looking for EPS upside in addition to revenue, so despite solid Aug Q guidance they think the stock likely trades off near-term. Firm's new Aug rev and EPS estimates are $240M and $0.48, vs. $211M and $0.41. Reiterates Buy due to attractive valuation (~11x CY07E EPS of $2.37) and belief that XRTX can benefit from several upcoming positive catalysts.

*Baird maintains Outperform rating on shares of XRTX following a mixed quarter and strong guidance. Forward estimates increasing, with continued room for EPS upside on improving GM and continued growth of higher-margin HDD Frank Timons Infrastructure business. Firm views shares as attractive at roughly 11-12x forward EPS estimates and prospects for 10-20%+ revenue/EPS growth for the next few years, particularly with incremental gains from STX/MXO.

*FBR notes XRTX reported a very strong, but noisy, quarter that needed several adjustments to get to comparable EPS. More importantly, guidance for the coming quarter was $241M and $0.49 at the midpoint--representing midpoint EPS fully 40% higher than the existing Street estimate. Based on several indicators in the mix and balance sheet, they believe that Street estimates for at least the next four quarters need to rise meaningfully. Firm is raising their estimates for 3Q06, FY06, and FY07 and increasing price target from $37 to $39, representing a 15.5x multiple of FY07 EPS.

Notablecalls: I think XRTX can and will move up once yesterday's buyers have exited most of their positions. That may not happen today.

Calls of Note Part 3

- Prudential notes they were amazed that Tenaris agreed to pay $2.7 billion for the $0.42 billion tangible book value of Maverick Tube, or 2.0 to 2.5 times estimated replacement value.

According to the firm U.S. Steel (NYSE:X)'s recent EBITDA is larger, and its processes and mix more varied. Thinks it is worth more than Maverick, or over $40 per share. However, a legitimate uncertainty exists as to the judgment of Tenaris and the reasonableness to generalize from its June 12th precedent.

They estimate Maverick's operating profit for 2006 at $448 million and $289 per ton of steel shipped. As a comparison, they estimate US Steel's tubular product segment, with similar capacity, to have an operating profit for 2006 at $938 million or $809 per ton.

Regards the Maverick Tube takeover as a cautionary flag to short-sellers. It is an insightful management that sells its company for over two times replacement value. Some investment bankers will use the Maverick precedent as a "comparable" to value future businesses for sale. Some participants might say that it sets the next value. A cynic might contend that one extraordinary buyer bought its target, and that another such buyer may not appear.

Notablecalls: Expect to see some interest in X today.

- Thomas Weisel Partners notes their recent industry checks in key Veeco Instruments (NASDAQ:VECO) segments (HDD and LED) give them increased confidence that current order trends are tracking above Street expectations for 2Q06 and 2H06. Based on end-market trends and industry checks, they believe that VECO is on track to meet or exceed firm's June quarter order estimate of $128mn (guidance is $125-130mn) and that upside exists to 2H06 order estimate of $253mn (flat H/H). Maintains Outperform.

Based on its accelerating earnings growth (112% y/y in 2006E) and generally conservative Street estimates, they believe VECO offers a compelling risk reward profile. VECO trades at a NTM P/S premium below the peer average with VECO at 1.4x versus 2.4x for the group. On a P/E basis, VECO trades at 19x, below the peer group average of 27x.

Notablecalls: Not actionable but good to know category.

- CIBC notes that effective 6/21, they upgrade Panera Bread Company (NASDAQ:PNRA) to Sector Outperformer from Sector Performer. Firm's proprietary market-by-market analysis suggests room for 3,000-3,500 Paneras, or 3X the current base and enough to sustain the current unit growth rate for 7 years. Unit growth is key to valuation in this sector.

For a chain this size, current store base is remarkably diverse, which speaks to breadth of concept's appeal. For example, 35% of units are in below- national-avg. income markets; many multi-unit markets have less than 200k pop. Mature markets still far less dense than for most other QSRs.

Still-sizable un-penetrated and under-penetrated markets, including no presence in 7 of top 50 U.S. markets, e.g., Phoenix, Portland (OR), Austin (TX). Other big markets (e.g., NY, LA, Philly, Seattle, Dallas) have less than 11 units each.

Notablecalls: Expect to see some upside in PNRA today. As I have said before I usually aviod posting upgrade/downgrades on this page but I think this one has a good point.

Calls of Note Part 2

- JP Morgan comments on Adobe Systems (NASDAQ:ADBE) after the co announced a multi year agreement with Google to offer Google Toolbar with Macromedia Shockwave replacing the current Yahoo! Toolbar offer. Acrobat Reader and Flash will still have the Yahoo! Toolbar but the firm thinks a transition to Google is possible. Estimates $16-48M of annual contribution possible but 2006 guidance included impact.

According to the firm most likely scenario is just over $30M to 2007. The 2006 impact was factored into management guidance, but they are increasing firm's 2007 revenue by $32M and pro-forma EPS by a penny.

Notablecalls: ADBE was up almost 1pt in after hours trading. I don't see it moving up any further on this deal.

- Bear Stearns notes that based on the combination of recently released industry data from comScore and their own proprietary statistical analysis, they believe Google (NASDAQ:GOOG) is experiencing a strong 2Q and could be on pace to grow sequential net revenues north of 11%, to $1.7B. Hence the firm ise raising their net revenue estimate to $1.7B from $1.63B and PF EPS to $2.31 from $2.23, which would exceed industry consensus of $1.62B and $2.18 respectively.

Firm points out that their analysis would only imply an outperformance of consensus estimates by 8% and other data release by comScore already implies a QTD sequential queries growth of 30%. They also note that consensus estimates have historically varied widely from actuals reported. Hence, recommends buying Google prior to the 2Q quarterly report. Maintains Outperform.

Notablecalls: Not actionable but good to know category.

- CIBC notes that despite the near-term setback Finisar (NASDAQ:FNSR) shares have taken since the company lowered its fiscal 2007 gross margin outlook largely due to product mix, they remain optimistic that new products in metro/telecom, 10 Gigabit Ethernet and network testing will boost the company average in 2HFY07.

Finisar has posted over 10 quarters of sql. revenue growth, with many of those quarters coming in above management's guidance. CIBC believes the fiscal 2007 guidance is conservative and does not factor in upside success from new products, thus are estimates are at the high end of the range.

Firm's positive outlook for FNSR has not changed following our meetings. They continue to believe that the datacom market offers the best visibility for optical component vendors and see Finisar's 55%-60% market share as a clear way to play SAN/LAN growth with upside coming from telecom. Maintains Sector Outperformer and $6 tgt.

Notablecalls: Not actionable but good to know category. My gut is telling me FNSR needs to see some more selling before one can safely buy.

Calls of Note Part 1

- Merrill Lynch is upping their estimates on Garmin (NASDAQ:GRMN) as the firm estimates that the market for personal navigation devices (PND) could grow over 40% (5 year CAGR) in the next five years. They continue to believe that PND growth will outpace growth in the OEM in-dash navigation systems. Firm currently estimates sthat PND growth in Europe will outpace the U.S. Forecasts 10.8 million units (U.S. and Europe) for 2006 growing to 17.7 million in 2007.

Raising 2006 EPS (before impact of FX) to $3.75 from $3.25. First Call mean is currently $3.57. They are also raising 2007E EPS to $4.50 from $4.15, which is above First Call mean of $4.09. Firm notes they are comfortable being above consensus as they do not think market is giving Garmin credit for greater potential upside in PNDs. Maintains Neutral due to valuation.

Notablecalls: 1) GRMN is a momentum stock 2) Merrill has one of the largest client bases on the Street 3) Their 2007 EPS est is now the highest on the Street. Actionable call.

- Stifel Nicolaus notes RealNetworks (NASDAQ:RNWK) hit a new multi-year high yesterday on no news. The shares have increased about $1.50 over the past week on no news other than an analyst upgrade, and about $3 over the past 2-3 months on little news and no change in guidance. The $1.50-$3.00 move doesn't sound that unusual for a technology stock, but because RNWK has $4.11 per share of net cash, the change has resulted in significant multiple expansion on measures of cash flow. For instance, on EBITDA, RNWK has gone from 15x at $8, to 24x at $9.20, to 36x at $10.83. 36x EBITDA is on the very high end of Internet Media peers and compares to an estimated 25% EBITDA growth rate in 2006 and 49% in 2007.

The analyst Kit Spring notes they can't recall such a large change in a stock's multiple in such a short time frame since the go-go days of the '90s. Firm's discipline of considering strong technical indicators and the potential for an earnings surprise keeps us from moving to a Sell rating, though from a short-term trading perspective they would be inclined to take profits at current levels, all else being equal. Maintains Hold.

Notablecalls: Note that Goldman Sachs is taking their rating down on RNWk to Underperform from In-line on valuation. Don't expect to see much of a bounce today.

- Two firms positive on Apple Computer (NASDAQ:AAPL) this morning:

*Piper Jaffray believes Mac market share is poised for growth for the following reasons: 1) Intel transition nearly complete, 2) improved availability of Macs, 3) expanding footprint of users of Apple products -- expect 85m iPods shipped by end of CY06, and 4) ability to run Windows on Mac.

Mac market share has been between 2.1%-2.5% over the last year. Firm is modeling for Mac market share to be 2.3% in CY06 and 2.4% in CY07. If Apple is able to grow market share to 3.0% in CY06 and 3.5% in CY07, it would add 10% and 17% to their EPS, respectively. Reits Outperform and $99 tgt.

*Morgan Stanley notes the Mac pilot at select Best Buy stores presents a meaningful growth opportunity in C2H06/2007. According to the firm, if one combines this with plans for International expansion, new product pipeline and an improving competitive position (full hardware + operating system updates by year-end), AAPL is well positioned to outperform the group over the next several quarters. Roughly 6 Best Buy stores initiated a pilot of Mac computers this Q. They continue to expect new Nano and Mac Pro (replaces PowerMac) product this Summer; video iPod and potentially an operating system upgrade cycle this Fall - all of which should help accelerate revenue momentum in C2H06. Maintains Overweight.

Notablecalls: Not exactly actionable but good to know.

According to the Wall Street Journals "Heard on the Street" column, Pier 1 (PIR), is revamping its furniture and home-decor offerings in an attempt to appeal to more upscale shoppers. Some investors argue that the overhaul ought to include the CEO's job, too. The future of Marvin Girouard as Chmn and CEO likely will be discussed today, when the co hosts its AGM and its board convenes afterward. "If the latest strategy doesn't work by the end of the year, that might be when the board starts looking at other alternatives and bigger changes," BB&T analyst Laura Richardson said. Ms. Richardson rates Pier 1's stock a Hold.

The WSJ reprots that Rising concern over potentially deadly blood clots has led some cardiac centers to cut back on use of drug-coated stents. The moves come as a growing number of studies question the effectiveness and safety of the stents. Stents generated $5.3bn in sales last year in a field dominated by Boston Scientific (BSX) and Johnson & Johnson (JNJ). Hospitals aren't drastically curbing use of coated stents, and there's no indication yet of an overall decline in sales of them. But some leading hospitals have started substituting uncoated, bare-metal stents in some patients. Moreover, the debate over the safety of drug-coated stents could signal turmoil in the booming industry.

Barron's Online discusses sowftware vendors that rent software, saying that those firms have the edge. Red Hat (RHAT) and Akamai (AKAM) are two such rent-a-software co's that can outperform the industry over the next 12 months. It's a good bet that signs of health in software will ultimately redound to the benefit of these younger firms. "I don't think Oracle could have posted that kind of quarter if the [information technology] spending environment weren't generally healthy," says Tony Ursillo, who helps manage $81bn for Loomis Sayles. "But I think the best opportunity is to target co's offering software as a service."

Notablecalls: Not actionable news today, but all good to know.