Barron's Summary (RRD)

Barrons’ “The Trader” column discusses RR Donnelley (RRD), whose stock is down 15% from a July 19 high. Part of RRD’s drop reflects some speculative air being let out of the price. Mkt chatter that RRD's strong and steady cash flows made it an attractive buyout candidate probably helped push the stock to 45 in July. Yet August's credit-mkt woes have reined in the M&A mkt, and investors who'd piled in hoping for a deal bailed out. RRD’s 2Q earnings report was another factor. Results beat expectations, but the co didn't raise its annual guidance, disappointing some. The headlong stampede out of RRD's stock, however, might be a buying opportunity for long-term investors, with as much as 25-30% upside possible over the next 18mo’s. Many think of printing as a "stodgy, cyclical business, but ppl don't know what Donnelley is about," argues Alexander Roeper, of Atlantic Investment Mgmt. "It's more than a printer of magazines, catalogs, and books, which is roughly a quarter of sales."

Manager likes NT, JDSU, ZHNE, CNXT, MSPD, BKHM, SUP, ARM, AXL, HAYZ, PKD, NR and GW. Dislikes FED, DSL and BKUNA.

At 39, CVS Caremark (CVS) trades for 17 times '08 estimates, roughly in line with rival Walgreen. If Wall Street wises up and starts to value CVS like a drugstore/PBM hybrid, however, the stock could rally into the mid-40s.

The stock of National Oilwell (NOV) isn't cheap, but another 20% of upside is possible if the oil boom continues. Another possibility: buying call options to limit risk.

Fuel Tech (FTEK) parked at 38 in June, only to retreat to 22. Now the stock is on the rise again, along with the company's orders, and some fans think it could top 40 in the next year.