Paperstand (AVP, BIIB, IMCL)

The WSJ's "Heard on the Street" column discusses Avon Products (AVP), saying that the co is showing signs that its big, multiyear makeover -- projected to cost $500m -- is working. The co this month announced a $2bn share-buyback plan over the next 5ys, which it will fund from cash flow. Although last qrtr's net income was 25% lower than a year earlier amid restructuring charges, the longer-term outlook for Avon's shares appears to be getting prettier. The buyback plan, which amounts to about $400m a yr, "is pretty aggressive and bold" in the midst of a cash-consuming turnaround, says Anant Sundaram, of Tuck School of Business. "Mgmt could be signaling confidence in its ability to generate substantial free-cash-flow growth in the future," he says. Avon's latest progress report, its 3Q results, comes next week. CEO Andrea Jung "needs to do well this qrtr. There are a lot of investors even more frustrated than they have been historically," says Ali Dibadj, of Sanford C. Bernstein.

"Ahead of the Tape" column discusses potential buyouts in biotech sector. Biotech shares, after years of languishing, have rallied in the past month and a half. The DJ US Biotech Index is up 13% since its recent low in late August. Shares are being driven by speculation that cash-rich pharma giants will snap up biotech outfits to fill drug-development pipelines and stave off generic-drug competition. "The fastest way for a big pharma to fix its problems is to go out and acquire co's" developing new treatments, says David Miller, of Biotech Stock Research. The most likely buyout tgts, the analyst says, are biotech powerhouses Biogen Idec (BIIB) and ImClone (IMCL).