As the second quarter earnings crunch begins in earnest this week, the bear market has investors jittery and prognosticators spinning out dire warnings. In the wake of mixed results from Alcoa (NYSE: AA) and General Electric (NYSE: GE) kicking things off last week, here's a look at what Wall Street is expecting from many of the companies scheduled to report this coming week.

Analysts surveyed by Thomson Financial are expecting the following companies to report a rise in earnings when compared to the same period of the previous year.

• Nucor Corp. (NYSE: NUE): $1.80 EPS (36.6%) on sales of $6.4 billion (+53.0%)
• Google Inc. (NASDAQ: GOOG): $4.74 EPS (24.9%) on sales of $3.9 billion (+41.6%)
• Nokia Corp. (NYSE: NOK): 56 cents EPS (23.2%) on sales of $19.9 billion (+17.8%)
• CSX Corp. (NYSE: CSX): 90 cents EPS (21.1%) on sales of $2.9 billion (+12.8%)
• Altera Corp. (NASDAQ: ALTR): 27 cents EPS (18.5%) on sales of $346.7 million (+8.4%)
• IBM (NYSE: IBM): $1.82 EPS (+17.6%) on sales of $25.9 billion (+9.0%)
• eBay Inc. (NASDAQ: EBAY): 41 cents EPS (17.1%) on sales of $2.2 billion (+18.0%)
• W.W. Grainger Inc. (NYSE: GWW): $1.46 EPS (17.1%) on sales of $1.7 billion (+8.0%)
• Microsoft Corp. (NASDAQ: MSFT): 47 cents EPS (17.0%) on sales of $15.7 billion (+17.0%)
• Honeywell International Inc. (NYSE: HON): 94 cents EPS (17.0%) on sales of $9.2 billion (+7.9%)

• Eaton Corp. (NYSE: ETN): $1.95 EPS (12.8%) on sales of $4.1 billion (+27.5%)
• Intel Corp. (NASDAQ: INTC): 25 cents EPS (12.0%) on sales of $9.3 billion (+7.4%)
• Abbott Laboratories (NYSE: ABT): 79 cents EPS (12.7%) on sales of $7.2 billion (+13.2%)
• Baxter International Inc. (NYSE: BAX): 82 cents EPS (12.2%) on sales of $3.1 billion (+7.7%)
• Coca-Cola Co. (NYSE: KO): 96 cents EPS (11.5%) on sales of $8.9 billion (+15.6%)
• Danaher Corp. (NYSE: DHR): $1.06 EPS (11.3%) on sales of $3.2 billion (+18.4%)
• United Technologies Corp. (NYSE: UTX): $1.30 EPS (10.8%) on sales of $15.3 billion (+9.9%)
• Schlumberger Ltd. (NYSE: SLB): $1.12 cents EPS (8.9%) on sales of $6.5 billion (+14.8%)
• Illinois Tool Works Inc. (NYSE: ITW): 97 cents EPS (7.2%) on sales of $4.6 billion (+9.9%)
• Yum! Brands Inc. (NYSE: YUM): 42 cents EPS (7.1%) on sales of $2.6 billion (+7.6%)
• Johnson & Johnson (NYSE: JNJ): $1.12 EPS (6.3%) on sales of $16.0 billion (+5.7%)
• Safeway Inc. (NYSE: SWY): 52 cents EPS (5.8%) on sales of $10.2 billion (+3.9%)
• Genuine Parts Co. (NYSE: GPC): 79 cents EPS (3.8%) on sales of $2.9 billion (+2.8%)

Analysts are looking for a number of the big financials reporting next week to post declines in earnings, but I've focused on those companies in a separate post (see Financials expected to post earnings declines, losses this week). The companies below are also expected to post declines in profit.

• Novellus Systems Inc. (NASDAQ: NVLS): 4 cents EPS (-91.1%) on sales of $251.5 million (-39.6%)
• Delta Air Lines Inc. (NYSE: DAL): 11 cents (-84.3%) on sales of $5.4 billion (+8.3%)
• Mattel Inc. (NYSE: MAT): 3 cents EPS (-50.0%) on sales of $1.0 billion (+3.9%)
• Harley-Davidson Inc. (NYSE: HOG): 76 cents EPS (-33.3%) on sales of $1.4 billion (-12.4%)
• Gannett Inc. (NYSE: GCI): $1.02 EPS (-17.7%) on sales of $1.7 billion (-10.0%)
• Sherwin-Williams Co. (NYSE: SHW): $1.39 EPS (-8.6%) on sales of $2.2 billion (-0.3%)

Continental Airlines Inc. (NYSE: CAL) is expected to swing to a loss of 52 cents (from $2.10 EPS last year) on $4.1 billion (+9.3%). And Advanced Micro Devices Inc. (NASDAQ: AMD) is expected to narrow its loss to 52 cents per share (from 95 cents per share last year) on sales of $1.5 billion (+5.2%).

With expectations listed out this way Wall Street seems pretty optimistic about earnings (other than for financial companies; see Financials expected to post earnings declines, losses this week). But we'll see this week whether the companies above can live up to these expectations. Do you think they will?

Other economic data coming out next week include:

• Producer price index (June 2008), Tuesday, 8:30 a.m. ET
• Business inventories (May 2008), Tuesday, 10:00 a.m. ET
• Consumer price index (June 2008), Wednesday, 8:30 a.m. ET
• NAHB housing market index (July 2008), Wednesday, 1:00 p.m. ET
• Housing starts (June 2008), Thursday, 8:30 a.m. ET

See also Market highlights for next week: Google, Microsoft reporting earnings

Visit AOL Money & Finance for more earnings coverage.

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Edwards Lifesciences Corporation (NYSE: EW) provides products and technologies designed to treat cardiovascular diseases. Offerings include tissue heart valves, valve repair products, heart monitoring equipment, central venous access devices and cardiac surgery system products. The company sells its goods through a direct sales force and independent distributors worldwide. Formerly part of Baxter International (NYSE: BAX), the firm was a year 2000 spin-off.

Edwards surprised the Street late last month, when it reported Q1 EPS of 56 cents and revenues of $296.8 million. Analysts had been expecting 49 cents and $284.4 million. In discussing the results, the CEO noted the success of new products and strong international sales growth. Management also guided Q2 EPS to 62-66 cents (58 cent consensus), FY08 EPS to $2.45-$2.53 ($2.35 consensus) and FY08 revenues to $1.210-$1.260 billion ($1.18B consensus).

The stock price popped on the news and has since been consolidating the gain in a bullish "flag" pattern. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the shares with two "strong buys", three "buys", ten "holds" and two "sells". Analysts expect a 17% growth rate, through the next year. The EW Price to Sales ratio (2.76), Price to Book ratio (3.96) and Price to Free Cash Flow ratio (21.24) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 95% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $41.69 and $57.74. A stop-loss of $48.90 looks good here.

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

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The blood thinner Heparin, used for surgery and dialysis has now killed 81 people in the US. According to The New York Times, "The F.D.A. has identified 12 Chinese companies that have supplied contaminated heparin to 11 countries." The contamination that caused the problems appears to come from manufacturers in China.

The news reopens the question of who is at fault when China ships bad products to the US. Companies like Mattel (NYSE: MAT) and Baxter (NYSE: BAX), a big heparin supplier, would like to blame the Chinese. Alternatively, they could say that the FDA does not have enough inspectors to keep up with drug components imported from the big Asian country.

But all of that is a dodge. Any company that sells a product should ultimately be responsible for that product's safety no matter what the current law says. Baxter makes the money on heparin, why should another entity be responsible for making sure its is safe?

Baxter might argue that it cannot sell heparin at a profit if all of the inspection responsibility falls to it. If so, it should exit the business and leave it to a company that can. All of those people who died would probably agree.

Douglas A. McIntyre is an editor at 247wallst.com

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MAJOR PAPERS:

• This year, the International Trade Commission is set to issue rulings on whether Samsung and Nokia Corporation (NYSE: NOK) have infringed patents from InterDigital Inc (NASDAQ: IDCC). If InterDigital, who licenses its patents to iPhone maker Apple Inc (NASDAQ: AAPL), wins, fees from the deals could double its revenue over the next few years, the Wall Street Journal contended.
• The Wall Street Journal also reported that Macy's Inc (NYSE: M) is among the retailers that include The Home Depot Inc (NYSE: HD) and Sears Holdings Corporation (NASDAQ: SHLD) to stop making its monthly disclosure of retail sales.

• According to FDA commissioners, the New York Times reported that Baxter International Inc's (NYSE: BAX) critical blood thinner heparin, which has been linked to nearly 20 deaths and whose base was created in China, contained a "possibly counterfeit" ingredient that "mimicked the real drug."
• In his opening arguments in the state of Alaska's lawsuit against Eli Lilly & Company (NYSE: LLY), an attorney for the state alleged the drug maker failed to warn doctors and patients of dangerous side effects associated with its drug Zyprexa, the Associated Press reported.

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MAJOR PAPERS:

• The Wall Street Journal reported that the focus of reports of four deaths and 350 allergic reactions to Baxter International Inc's (NYSE: BAX) generic version of the blood thinner drug Heparin, and the ingredients supplied by a Chinese manufacturer, also includes Wisconsin-based Scientific Protein Laboratories, a co-owner of the Chinese manufacturing plant, and majority owned by American Capital Strategies Ltd (NASDAQ: ACAS), a Maryland buyout firm.
• Citigroup Incorporated (NYSE: C) has suspended investors at its CSO Partners hedge fund from withdrawing their money after they attempted to pull more than 30% of the fund's nearly $500M in assets, the Wall Street Journal reported.
• AT&T Inc (NYSE: T) is seeking more revenue from India as it tries to expand its consumer mobile phone operations outside the U.S, the Financial Times reported.

• According to the New York Times, the FDA broke its own rules by approving for sale Baxter International's Heparin without first inspecting a Chinese plant where the drug's key ingredient is made.

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MAJOR PAPERS:

• The active ingredient in Baxter International Inc's (NYSE: BAX) generic version of the anticlotting drug heparin, under investigation for four deaths and hundreds of bad reactions, was made in China, the Wall Street Journal reported.
• Structured investment vehicles that provide short term debt to fund the purchases of municipal bonds and student loans are under increasing pressure, according to the Wall Street Journal's "Heard on the Street". Citigroup Incorporated (NYSE: C), JP Morgan Chase & Co (NYSE: JPM) and Merrill Lynch & Co Inc (NYSE: MER) are among the banks that could be affected.

• The New York Times reported that Hewlett-Packard Company (NYSE: HPQ) has settled with The New York Times Company (NYSE: NYT) and McGraw Hill Companies Incorporated's (NYSE: MHP) BusinessWeek journalists related to a spying scandal that stemmed from obtaining telephone records. The involved parties did not disclose the amount of the settlement.

• Mike Zafirovski, CEO of Nortel Networks Corporation (NYSE: NT), said the company would examine possible opportunities to be taken over "when they arise." Mr. Zafirovski did not comment on rumors of a Motorola Inc (NYSE: MOT) merger, Reuters reported.

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A plant in China may be producing flawed ingredients for the big-selling Baxter International (NYSE:BAX) blood thinner Heparin. According to The Wall Street Journal, it is the same "blood-thinner that is under investigation after reports of hundreds of allergic reactions and four deaths among the drug's users."

While the FDA failed to inspect that facility, it is Baxter's responsibility to ensure the safety of its own products. The debacle is not unlike the one that plagued Mattel (NYSE: MAT) last year when it was importing toys from China that contained high levels of lead. In Baxter's case, however, it appears that people have lost lives.

Baxter and the FDA now probably face months of criticism, much of it coming from Congress, which is already concerned about the quality of China-made products.

Baxter also needs to worry about whether it will be viewed as having any liability in the cases where Heparin caused illness. It looks like a trial lawyer's dream.

Douglas A. McIntyre is an editor at 247wallst.com

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MOST NOTEWORTHY:

• Baird initiated Amag Pharmaceuticals (NASDAQ: AMAG) with an Outperform rating and believes concerns regarding ferumoxytol approvability are misplaced.
• JP Morgan assumed coverage of Corn Products (NYSE: CPO) with an Overweight rating and points to the company's growth in emerging markets and improved business economics in its core U.S. market.
• RBC Capital is positive on Alpharma's (NYSE: ALO) Flector opportunity in the U.S. topical NSAID market. The firm started shares with an Outperform rating and $28 target.

• Merrill resumed coverage of Baxter (NYSE: BAX) with a Buy rating.
• Goldman initiated Teradyne (NYSE: TER) with a Neutral rating and $11 target.
• Allianz AG (NYSE: AZ) was initiated with a Buy rating at Societe Generale.

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In the business world, innvoation leads to longevity. There is a medical products firm in Deerfield, Illinois that was the first manufacturer of commercially prepared intravenous solutions. It was also responsible for such landmark developments as the first container that could store blood for more than a few hours, the first means of separating plasma from whole blood and storing it for future use, and the first disposable total-bypass blood-oxygenator. The company has been in business for 76 years.

Baxter International (NYSE: BAX) is a diversified medical products and services company. It provides devices, pharmaceuticals, and biotechnology for the treatment of hemophilia, immune disorders, cancer, infectious diseases, kidney disease and trauma. The BioScience segment manufactures plasma-based therapies for immune disorders, biosurgery products for hemostasis, and vaccines. The Medication Delivery unit makes intravenous solutions and administration sets. The Renal segment manufactures products for peritoneal dialysis, a home therapy for people with end-stage renal disease. Boston Scientific (NYSEL: BSX) is a major competitor.

Investors were pleased last week, when Citigroup upgraded the shares from "hold" to "buy." Analyst Matthew J. Dodds said the firm can increase its gross margins above Wall Street expectations, a welcome prediction ahead of the Baxter's fourth quarter report (1/24). He also predicted 2008 EPS of $3.21, versus the Street expectation of $3.10.

Altogether, brokers now recommend the shares with five "buys" and four "holds". Analysts expect a 14% average annual growth rate, through the next five years. The BAX EPS Growth rate (22.81%), Operating Margin (18.88%), Net Profit Margin (15.08%), Return on Assets (11.83%), Return on Investment (15.51%) and Return on Equity (26.30%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 85% of the outstanding shares. The stock is one of those used to calculate the S&P 500 and S&P 100 Indexes. Over the past 52 weeks, it has traded between $47.20 and $65.20. A stop-loss of $56.25 looks good here.

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

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In biotechnology, corporate success is a function of approved drugs, pipeline activity and positive cash flow. By those standards, one of the most successful firms in the industry is a 27 year old Thousand Oaks, California outfit that was among the first developers of blockbuster biopharmaceuticals.

Amgen (NASDAQ: AMGN) is a biotechnology firm engaged in the discovery and manufacture of human therapeutics. It markets products in the areas of supportive cancer care, nephrology, inflammation, and oncology. Principal offerings include anemia treatments Aranesp and Epogen, rheumatoid arthritis drug Enbrel, and white blood cell stimulator Neupogen. Amgen has marketing alliances with Hoffmann-La Roche and Kirin. Competitors include Baxter International (NYSE: BAX), Johnson & Johnson (NYSE: JNJ) and Novartis (NYSE: NVS).

The company pleased the Street earlier in the week, when it said it expected 2007 adjusted EPS of close to $4.30. That was above the firm's previous guidance range ($4.13-4.23) and the consensus analyst view ($4.24). Management also announced that it plans to move ten molecules into mid-stage trials this year.

Brokers recommend the stock with two "strong buys", seven "buys", nineteen "holds" and one "sell". The AMGN P/E ratio (17.40), Price to Book ratio (3.06), Price to Cash Flow ratio (12.13), Price to Free Cash Flow ratio (14.00), Operating Margin (26.32%), Net Profit Margin (21.29%), Return on Assets (9.58%) and Net Income per Employee ($158.20k) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 73% of the outstanding shares. The stock is one of those used to calculate the S&P 100, S&P 500 and Nasdaq 100 Indexes. Over the past 52 weeks, it has traded between $44.55 and $76.95. A stop-loss of $41.35 looks good here. Note that the firm is expected to release fourth quarter results in about two weeks.

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

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In the business world, innovation leads to longevity. There is a medical products firm in Deerfield, Illinois, that was the first manufacturer of commercially prepared intravenous solutions. It was also responsible for such landmark developments as the first container that could store blood for more than a few hours, the first means of separating plasma from whole blood and storing it for future use, and the first disposable total-bypass blood-oxygenator. The company has been in business for 76 years.

Baxter International (NYSE: BAX) is a diversified medical products and services firm. It provides devices, pharmaceuticals, and biotechnology for the treatment of hemophilia, immune disorders, cancer, infectious diseases, kidney disease and trauma. The BioScience segment manufactures plasma-based therapies for immune disorders, biosurgery products for hemostasis, and vaccines. The Medication Delivery unit makes intravenous solutions and administration sets. The Renal segment manufactures products for peritoneal dialysis, a home therapy for people with end-stage renal disease. The company has more than 250 facilities in 50 countries around the world. Boston Scientific (NYSE: BSX) is a major competitor.

The Street was surprised last week, when the firm reported Q3 EPS of 70 cents and revenues of $2.75 billion. Analysts had been looking for 66 cents and $2.68 billion. Baxter repurchased about $827 million in shares, during the quarter. Management also guided Q4 EPS to 72-74 cents, versus Street consensus of 71 cents. Bear Stearns subsequently reiterated its "outperform" rating on the issue and boosted its price target to $68. The stock popped on the news and then passed into a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Altogether, brokers recommend the shares with one "strong buy," four "buys" and four "holds." Analysts expect a 13% average annual growth rate through the next five years. The BAX Price to Sales ratio (3.41), Price to Cash Flow ratio (16.80), EPS Growth rate (22.81%), Operating Margin (18.88%), Net Profit Margin (15.08%), Return on Assets (11.83%), Return on Investment (15.51%) and Return on Equity (26.30%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 85 percent of the outstanding shares. The stock is one of those used to calculate the S&P 500 and S&P 100 Indexes. Over the past 52 weeks, it has traded between $43.38 and $60.98. A stop-loss of $50.90 looks good here.

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

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In biotechnology, corporate success is a function of approved drugs, pipeline activity and positive cash flow. By those standards, one of the most successful firms in the industry is a 27-year-old Thousand Oaks, California outfit that was among the first developers of blockbuster biopharmaceuticals.

Amgen (NASDAQ: AMGN) is a biotechnology firm engaged in the discovery and manufacture of human therapeutics. It markets products in the areas of supportive cancer care, nephrology, inflammation, and oncology. Principal offerings include anemia treatments Aranesp and Epogen, rheumatoid arthritis drug Enbrel, and white blood cell stimulator Neupogen. Amgen has marketing alliances with Hoffmann-La Roche and Kirin. Competitors include Baxter International (NYSE: BAX) and Novartis (NYSE: NVS).

The stock popped last month on word an FDA advisory panel had rejected a proposal to set a specific target for red blood-cell levels in kidney-failure patients being treated with Aranesp, Epogen and Procrit. The latter is manufactured by Amgen, but sold by Johnson & Johnson (NYSE: JNJ). The panel's decision, if accepted by the FDA, could boost sales of the medications. Since the initial gain, the AMGN share price has been defining a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Brokers recommend the stock with six "strong buys," six "buys," 18 "holds" and one "sell." The AMGN P/E ratio (16.19), PEG ratio (1.50), Price to Book ratio (3.73), Price to Cash Flow ratio (12.07), Price to Free Cash Flow ratio (16.98), Operating Margin (32.57%), Net Profit Margin (27.35%), Return on Assets (12.65%), Return on Investment (15.02%), Return on Equity (24.41%) and Net Income per Employee ($203.25k) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 76% of the outstanding shares. The stock is one of those used to calculate the S&P 100, S&P 500 and Nasdaq 100 Indexes. Over the past 52 weeks, it has traded between $48.30 and $77. A stop-loss of $48.65 looks good here. Note that the firm is expected to release third quarter results on October 25, after the close.

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

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The accidental transmission of infections is a big day-to-day problem for hospital personnel. There is an outfit in San Clemente, California that makes devices designed to avoid one of the major sources of the problem.

ICU Medical (NASDAQ: ICUI) provides disposable medical connection systems for use in intravenous (IV) therapy applications. Its products prevent accidental IV disconnects, protect patients from catheter related bloodstream infections and guard healthcare workers from exposure to infectious diseases through accidental needle sticks. The firm also manufactures various critical care products, including pressure monitoring devices, blood sampling systems, cardiac monitoring systems and angiography kits, under an agreement with Hospira (NYSE: HSP). Baxter International (NYSE: BAX) is a major competitor.

The company pleased investors last week, when it reported Q1 EPS of 63 cents. Analysts had been expecting 44 cents. Revenues rose 0.2 percent (yr/yr) to $48.8 million. Management also guided FY07 EPS to $1.97 ($1.79 consensus) and FY07 revenues to $206.0 million ($205.9M consensus). Gross margins rose to 39%, from 33% in Q4. ICUI shares popped above 200-day moving average support on the news and are now forming a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Brokers recommend the stock with one "strong buy" and one "hold." Analysts see a 25% average annual growth rate, through the next five years. The ICUI PEG ratio (1.07), Price to Sales ratio (3.19), Price to Book ratio (2.86), EPS Growth rate (53.66%), Net Profit Margin (12.45%), Return on Assets (11.18%) and Return on Investment (12.02%) compare favorably with industry, sector and S&P 500 averages.

Institutional investors hold about 95% of the outstanding shares. The stock is one of those used to calculate the S&P 600 SmallCap Index. Over the past 52 weeks, it has traded between $36.23 and $48.51. A stop-loss of $38.35 looks good here.

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MarketWatch technology columnist Bambi Francisco is the Dow Jones & Co.'s (NYSE: DJ) website's answer to CNBC's Maria Bartiromo. Now it looks like she's followed the ethical path blazed by the Money Honey.

The Wall Street Journal (subscription) today reported that Francisco invested in Vator.TV, a video platform that links entrepreneurs with venture capitalists. Dow Jones reporters are allowed to invest in whatever they want to, provided that they don't use their position to further their own interests.

MarketWatch executive editor David Calloway said he approved of Francisco's investment under the condition that she "not write about that company, its investors, or the companies using Vator.TV," the Journal said.

That didn't happen.

In January, Francisco posted an interview with a company called PreFound, which had previously uploaded a video on Vator, and in March wrote an item about Helio, which had uploaded a video on Vator, according to the Journal. Four days she wrote about Friendster, the social networking site posted a video on Vator.TV, the paper said.

Francisco has her own personal blog in which she has a video blog called Vator Reports, which she described as
"a show on innovation, based on the many innovative ideas and businesses Peter Thiel and I are seeing on the vator.tv site."

Thiel is the co-founder of PayPal and also an investor in Vator.TV. He's also a backer of Facebook, which Francisco also wrote about. Her bosses apparently never bothered to look on her site or Valleywag, which had this story in November.

Most journalists would have been fired for doing what she did. But Francisco, like Bartiromo, isn't like most journalists. It will be interesting to see what if any punishment she gets from Dow Jones.

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Companies start to believe their own PR hype. Investors push a stock past logical limits. A company seems about to break down or break out. These are just a few things that can signal a stock with attitude. And... that attitude can be good or bad for the stock price, since attitude always catches up with reality. At least on Wall Street, that is.

Baxter International (NYSE:BAX) was up $1.46 (+3.03%) Thursday to close at $49.61 on unusually high volume, as more than double the 30-day average number of shares traded hands. Investors were encouraged earlier in the session when the company announced strong earnings assisted by robust sales from its Bio Science division. The technicals for the stock have been positive lately and Baxter has a cautious S&P 3 STAR hold rating. Out of the 12 other analysts who cover the stock, three give it a strong buy and nine give it a hold rating.

Baxter's stock has been on a nice uptrend since the beginning of July 2006. BAX shares bounced around for the first part of last year after hitting a 35.12 low on February 7, 2006. Yesterday's 49.61 closing price represents a 41.2% rise from its 52-week low. Lately Baxter has been able to balance sales and profits with R&D expenditures, much to the delight of investors and Wall Street.

Other big Pharma companies like Amgen Inc. (NASDAQ:AMGN) Bristol-Myers Squibb (NYSE: BMY), Abbott Laboratories (NYSE:ABT), Pfizer Inc. (NYSE:PFE), Merck & Co (NYSE:MRK),and Genentech Inc. (NYSE: DNA), just don't seem to have the optimal research, product pipeline and pills on the shelf to beat Baxter these days. Stock prices for all six of these others companies fell in trading yesterday, Bristol Myers was the biggest loser with a 2.63% drop. That said, this is the pharma biz and things can change in twelve months, so investors in this sector must be prepared to exit when the time is right. No stock in this sector is probably a long-term buy-and-hold candidate.

For a bullish-to-neutral conservative hedged play on BAX, I would consider a May covered call around the 47.50 area. There is even a small dividend on the stock with a 1.2% yield.

Vic Schiller is an analyst with attitude at Investors Observer.

DISCLOSURE NOTE: Mr. Schiller owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about.

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Goldman Sachs has made several changes to its Conviction Buy List this morning. Most notably was a removal of Wal-Mart Stores Inc. (NYSE:WMT) from the list. Goldman replaced Wal-Mart's place with Target Corp. (NYSE:TGT).

TGT was given a $68 target and WMT target was cut to $53 from $57 per share. On Wal-Mart, Goldman analysts believe a turnaround is in its early stages and they see little positive momentum into the critical holiday season. Goldman Sachs maintained an official Buy rating for WMT, but simultaneously lowered Fiscal 2006 EPS from $2.87 to $2.83. Target (TGT) EPS estimates were raised by $0.01 to $3.18.

Baxter International Inc. (NYSE:BAX) & Aracruz Celulose (NYSE:ARA) were also trimmed off the Americas Conviction Buy List as was Flextronics International Ltd. (NASDAQ:FLEX). FLEX shares are down 9% since being added to the list in September and Goldman expects a more of a seasonal slowdown. On the other hand, Crown Holdings (NYSE:CCK) was added to Goldman Sachs Americas Conviction Buy List.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.

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