Ultralife Batteries (NASDAQ: ULBI) provides a range of non-rechargeable and rechargeable batteries, charging systems and communications accessories for use in military, industrial and consumer portable electronics products. The company's non-rechargeable lithium batteries are used to power such diverse devices as radios, emergency radio beacons, search and rescue transponders, portable medical devices and smoke alarms. Its lithium polymer and lithium ion rechargeable batteries are used in such portable devices as laptop computers and cell phones. The US Department of Defense accounts for about twenty percent of Ultralife's sales. Major commercial customers include General Dynamics (NYSE: GD), General Motors (NYSE: GM) and RadioShack (NYSE: RSH).

The company pleased investors last week, when it issued upside guidance for the current quarter and year. Management sees Q2 revenues of more than $75 million ($60.43M consensus) and FY08 revenues of at least $250 million ($240.27 million consensus). The CEO said the better performance was attributable to "strong shipments to date, strong backlog in most businesses and requests from customers for accelerated deliveries against their orders."

ULBI shares popped into a bullish "pennant" consolidation pattern on the news. Prices frequently exit pennants moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the shares with one "strong buy," three "buys" and two "holds." Analysts see an 18% average annual growth rate, through the next five years. The ULBI Sales Growth rate (53.56% y/y), EPS Growth rate (0.00 to 0.14 y/y) and Return on Investment (11.09%) compare favorably with industry, sector and S&P 500 averages. Institutions own about 55% of the outstanding shares. Over the past 52 weeks, the stock has traded between $9.50 and $22.98. A stop-loss of $11.50 looks good here. Note that the firm is expected to report Q2 results in late July.

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

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MOST NOTEWORTHY:

• Keefe Bruyette upgraded shares of IberiaBank (NASDAQ: IBKC) to Market Perform from Underperform after the company announced that Pulaski has assumed the insured deposits of ANB Financial of Bentonville, Arkansas.
  
• KeyBanc upgraded Dynamic Materials (NASDAQ: BOOM) to Buy from Hold citing stability in base business, valuation, and the added benefit associated with a European competitor being acquired.
  
• Cowen raised Barr Pharma (NYSE: BRL) to Outperform from Neutral citing the recent pullback.

• Goldman added McGraw-Hill (NASDAQ: MHP) to its Conviction Buy List.
  
• RBC Capital raised RadioShack (NYSE: RSH) to Sector Perform from Underperform.
  
• Sirius Satellite (NASDAQ: SIRI) was upgraded at Merrill Lynch to Neutral from Sell.

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Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Alcatel-Lucent (NYSE: ALU) reported its fifth straight quarterly loss and lowered its outlook.
• Anadigics Inc. (NASDAQ: ANAD) beat Q1 expectations and raised its Q2 guidance.
• AuthenTec Inc. (NASDAQ: AUTH) Q1 revenues jumped 67% on new product offerings.
• CBS Corp. (NYSE: CBS) posted better-than-expected Q1 results and raised its dividend.
• Cognex Corp. (NASDAQ: CGNX) beat Q1 expectations and lifted its outlook.
• Comcast Corp. (NASDAQ: CMCSA) posted soild Q1 results on high-speed internet/digital phone strength.
• DreamWorks Animation Inc. (NYSE: DWA) earnings and revenues soared in the first quarter.
• Eastman Kodak Co. (NYSE: EK) narrowed its Q1 loss but missed earnings estimates.
• IAC/InterActivCorp (NASDAQ: IACI) Q1 profits fell but met analsts' expectations.
• LSI Corp. (NYSE: LSI) beat Q1 expectations and raised its guidance for the next quarter.
• NetSuite Inc. (NASDAQ: N) narrowed its loss on a surge in Q1 revenue.
• Omniture Inc. (NASDAQ: OMTR) Q1 revenue jumped 136% on acquisitions.
• RadioShack Corp. (NYSE: RSH) just beat low Q1 expectations on lower demand and narrower margins.
• SAP AG (NYSE: SAP) earnings for the first quarter fell short of analysts' expectations.

• Sohu.com Inc. (NASDAQ: SOHU) Q1 profits rose 156%, easily beating analysts' estimates.
• Sun Microsystems Inc. (NASDAQ: JAVA) reported a Q3 loss and announced layoffs.
• Teledyne Technologies Inc. (NYSE: TDY) posted its 25th consecutive quarterly earnings growth.
• Verizon Communications Inc. (NYSE: VZ) posted solid Q1 profits in line with expectations.
• Viacom Inc. (NYSE: VIA) posted solid Q1 profits despite weakness in movie business.
• Virtual Radiologic Corp. (NASDAQ: VRAD) solid Q1 results failed to impress investors.

Also, Jim Cramer lauds Procter & Gamble Co. (NYSE: PG) for its success in these tough times and Colgate-Palmolive Co. (NYSE: CL) for bouncing back after taking a hit. And Time Warner Inc. (NYSE: TWX) investors may have been looking for more than they got in the quarterly report.

Upcoming results to watch for include Anadarko Petroleum (NYSE: APC), Cisco Systems (NASDAQ: CSCO), Fannie Mae (NYSE: FNM), Molson Coors (NYSE: TAP), Walt Disney Company (NYSE: DIS), and American International Group (NYSE: AIG).

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• DJIA 12,872.97 (-18.89; -0.15%)
  
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• NASDAQ 2,424.40 (+1.47; +0.06%)
  
• 10-YR TBond 3.835% (-0.03%)
• 52-WEEK LOWS
• Top 10 Analyst Calls

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Here are a few highlights from this past week's earnings coverage from BloggingStocks:

• Axsys Technologies Inc. (NASDAQ: AXYS) beat estimates for the fourth quarter and raised its guidance.
• Deli Inc. (NASDAQ: DELL) missed expectations for the fourth quarter despite its move into retail outlets.
• Goldman Sachs Group Inc. (NYSE: GS) is lowering expectations for the quarter just ended.
• Home Depot Inc. (NYSE: HD) missed expectations, dragged down by the housing slump.
• Lowe's Cos. Inc. (NYSE: LOW) beat low expectations though profit fell due to the housing slump.
• Nordstrom Inc. (NYSE: JWN) beat estimates, though earnings and revenue fell.
• Office Depot Inc. (NYSE: ODP) fourth-quarter profits sank, falling short of Wall Street expectations.
• RadioShack Corp. (NYSE: RSH) beat expectations as lower operating costs offset lower same-store sales.
• Sears Holdings Corp. (NASDAQ: SHLD) missed estimates as both earnings and revenue fell.
• Sprint Nextel Corp. (NYSE: S) posted a fourth-quarter loss on acquistions-related write-downs.
• Toll Brothers Inc. (NYSE: TOL) swung to a $96 million loss, another victim of the housing slump.

Also, analysts predict that bank losses will be the highest in 20 years. See Jim Cramer's take on Lowe's and Nordstrom results. Timothy Sykes recommends investors not become starstruck by superstar companies such as Apple Inc. (NASDAQ: AAPL) and Google Inc. (NASDAQ: GOOG).

Upcoming results to watch for include Staples Inc. (NASDAQ: SPLS), Costco Wholesale (NASDAQ: COST), and Blockbuster Inc. (NYSE: BBI).

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Ultralife Batteries (NASDAQ: ULBI) provides a range of non-rechargeable and rechargeable batteries, charging systems and communications accessories for use in military, industrial and consumer portable electronics products. The company's non-rechargeable lithium batteries are used to power such diverse devices as radios, emergency radio beacons, search and rescue transponders, portable medical devices and smoke alarms.

Its lithium polymer and lithium ion rechargeable batteries are used in such portable devices as laptop computers and cell phones. The U.S. Department of Defense accounts for about 20 percent of Ultralife's sales. Major commercial customers include General Dynamics (NYSE: GD), General Motors (NYSE: GM) and RadioShack (NYSE: RSH).

The company pleased investors late last month, when it received a $40 million follow-on to a $62 million defense order for communications systems. Management also issued FY08 revenue guidance of at least $230 million, a level well above the Wall Street consensus view. ULBI shares popped on the news and then moved into a bullish "pennant" consolidation pattern. Prices frequently exit pennants 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," two "buys" and one "hold." Analysts see an 18 percent average annual growth rate through the next five years. The ULBI Sales Growth rate (40.32%) and EPS Growth rate (92.55%) compare favorably with industry, sector and S&P 500 averages. Institutions own about 44 percent of the outstanding shares. Over the past 52 weeks, the stock has traded between $7.98 and $21.76. A stop-loss of $18.25 looks good here. Note that the firm is next expected to report quarterly results in mid-February.

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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Electronics retailer RadioShack Corporation (NYSE: RSH) is on the rebound. The company posted net income of $46.3 million for 3rd Quarter 2007, as opposed to a net loss of $16.3 million in 3Q 2006. Cash generation is up, prepaid wireless system sales are up, GPS system sales are up, gross profit is up, and cash balances are up. On the flip side, better inventory management and a more profitable product mix combined with serious cost control efforts to reduce SG&A expenses by 13%, contributed to the rebound.

Radio Shack managed to post these good numbers despite the fact that total sales fell 9.4% due to large declines in Sprint post-paid wireless systems. CEO Julian Day insists that Radio Shack will continue to focus on both growth and profitability despite continuing problems in post-paid wireless sales. The company is trying to help its bottom line by continuing to repurchase shares, $162 million worth in 3Q 2007 alone, out of $209 million YTD.

Perhaps electronics will be a hot holiday seller this winter, giving Radio Shack a much needed boost. The stock currently trades at $18.21 and will pay a dividend of 25 cents per share.

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Lots more quarterly reports rolled out this past week, and here are some highlights of earnings coverage from BloggingStocks:

• Alcatel-Lucent (NYSE: ALU) reported more losses and more job cuts.
• Alvarion Ltd.'s (NASDAQ: ALVR) record quarter fuels speculation of a Cisco (NYSE: CSCO) buyout.
• Avon Products Inc.'s (NYSE: AVP) profit rose 61%, buoyed by strength in emerging markets.
• Chevron Corp. (NYSE: CVX) fell short of expectations due to tighter margins.
• CIGNA Corp. (NYSE: CI) had a solid quarter but warned about 2008 earnings.
• Clorox Co. (NYSE: CLX) blamed profit loss on materals costs, and announced acquistion of Burt's Bees.
• Colgate-Palmolive Co. (NYSE: CL) beat estimates by a penny and had strong sales overseas.
• Crocs Inc. (NASDAQ: CROX) beat earnings estimates and revised its full-year forecast.
• Dell Inc. (NASDAQ: DELL) announced it would restate revenues, ahead of its November quarterly report.
• Exxon Mobil Corp. (NYSE: XOM) missed expectations, also due to tighter margins.
• Given Imaging Ltd. (NASDAQ: GIVN) cited FDA approval delays for disappointing results.
• Hertz Global Holdings Inc. (NYSE: HTZ) posted record revenues and appointed a new CFO.
• Humana Inc.'s (NYSE: HUM) positive surprise lifted the share price to a new all-time high.

• IAC/InterActiveCorp (NASDAQ: IACI) fell short of expectations, dragged down by the housing slump.
• International Paper Co.'s (NYSE: IP) revenue beat estimates, while earnings were in line with them.
• Jones Apparel Group Inc.'s (NYSE: JNY) earnings soared on one-time gains.
• KBR Inc. (NYSE: KBR) beat expectations due to one-time gains.
• Kellogg Co. (NYSE: K) beat expectations, in part on the strength of international sales.
• Kraft Foods Inc. (NYSE: KFT) citeed dairy costs and investments in its profit decline.
• MasterCard Inc.'s (NYSE: MA) profit soared 63% on cardholder spending in international markets.
• Newmont Mining Corp. (NYSE: NEM) easily beat estimates, sending the share price to a 52-week high.
• Procter & Gamble Co. (NYSE: PG) beat estimates by a penny and had strong sales overseas.
• Radio Shack Corp. (NYSE: RSH) beat expectations on earnings but not revenue.
• R.R. Donnelley & Sons Co. (NYSE: RRD) beat estimates and revised its guidance.
• Sirius Satellite Radio Inc. (NASDAQ: SIRI) reported a smaller-than-expected loss, strong subscriber growth.
• Sprint Nextel Corp. (NYSE: S) stumbled in Q3 on management and merger issues.
• TEVA Pharmaceutical's (NASDAQ: TEVA) strong margins helped it beat expectations by a penny.
• Toshiba Corp.'s (OTC: TOSBF) profit soared due to increased sales of flash memory chips.
• Trump Entertainment Resorts Inc. (NASDAQ: TRMP) announced higher profit on lower costs.
• Under Armour Inc. (NYSE: UA) beat expectations and offered revised guidance.
• U.S. Steel Corp, (NYSE: X) blamed its poor results on acquisitions costs and Chinese imports.
• Verizon Communications (NYSE: VZ) reported a profit loss, based on tax-related charges.

Jim Cramer isn't buying the excuses that Comcast Corp. (NASDAQ: CMCSA) and Coach Inc. (NYSE: COH) offered in their recent quarterly reports. One expert is more impressed with Intel Corp.'s (NASDAQ: INTC) results than with Microsoft Corp.'s (NASDAQ: MSFT). And Zac Bissonnette points to the importance of questioning too-good-to-be-true results.

Upcoming results to watch for include: Archer Daniels Midland Co. (NYSE: ADM), Cisco Systems Inc. (NASDAQ: CSCO), General Motors Corp. (NYSE: GM), Ford Motor Co. (NYSE: F), Time Warner Inc. (NYSE: TWX), News Corp. (NYSE: NWS), Walt Disney Co. (NYSE: DIS), Burger King Holdings Inc. (NYSE: BKC), and Qualcomm Inc. (NASDAQ: QCOM).

Visit AOL Money & Finance for more earnings coverage.

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Children's Place (NASDAQ: PLCE) operates 899 The Children Place stores and 328 Disney Stores. PLCE is recently up $1.58 to $24.23 on renewed takeover speculation. Ex-chief executive, Ezra Dabah, a owner of 17.9% of PLCE, has said he's considering buying the company and engaged Bear Stearns (NYSE: BSC) as his financial adviser. PLCE November option implied volatility of 76 is above its 26-week average of 45 according to Track Data, suggesting traders are positioning themselves for a high share price.

RadioShack (NYSE: RSH), a company with a presence of through approximately 6,000 stores, is recently up .33 cents to $19.78 on renewed & unconfirmed buyout speculation. RSH is expected to report EPS on 10/29. RSH call option volume of 5,206 contracts compares to put volume of 514 contracts. RSH November option implied volatility of 70 is above its 26-week average of 43 according to Track Data, suggesting larger price risks.

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

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RadioShack (NYSE: RSH), a company with a presence of through approximately 6,000 stores, closed at $21.45. RSH is expected to report EPS on 10/29. Sprint (NYSE: S) announced it expects a net loss of 337,000 post paid subscribers and lower annual revenue expectations. BMO Capital Markets say's "this is bad news for RSH as we estimate revenues related to S make up over half of wireless sales and over 15% of total revenues." RSH is expected to report EPS on 10/29. RSH November option implied volatility of 59 is above its 26-week average of 41 according to Track Data, suggesting larger price risks.

Costco (NASDAQ: COST) is expected to announce 4Q EPS of 83 cents on 10/10. Wachovia (NYSE: WB) said on 10/8 "COST's outlook for margin should be one of the key issues in focus on Wednesday's call." WB has an Outperform rating on COST. COST October option implied volatility of 33 is above its 26-week average of 24 according to Track Data, suggesting larger fluctuations.

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

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The markets stayed in a holding pattern today, not really moving up or down very much. Oil made some mild gains as November futures rose up $1.58 a barrel to $81.52 as a storm is forecast for the Gulf of Mexico.

The NYSE had volume of 2.7 billion shares with 2,024 shares advancing while 1,227 declined for a gain of 41.90 points to close at 10,142.93. On the NASDAQ, 1.7 billion shares traded, 1,659 advanced and 1,294 declined for a gain of 4.14 to 2,733.57.

Hansen Natural Corporation (NASDAQ: HANS) rose $3.92 (7%) to $62.92. RadioShack Corporation (NYSE: RSH) fell $1.25 (-5%) to $21.51. Lennar Corporation (NYSE: LEN) fell $1.48 (-6%) to $24.34. Research In Motion Limited (NASDAQ: RIMM) rose $4.26 (4%) to $100.54. Marriott International, Inc. (NYSE: MAR) fell $2.04 (-5%) to $42.28.

In options there were 3.9 million puts and 6.1 million calls traded for a put/call open interest ratio of 0.64. Verizon Communications, Inc. (NYSE: VZ) saw heavy volume on the October 42.50 calls (VZJV) with over 182,000 options trading. The October 40 calls (VZJH) also had volume move with 164,600 options trading. The stock pays a dividend tomorrow so this is likely dividend arbitrage. Petroleo Brasileiro S.A. (NYSE: PBR) saw heavy volume on the October 60 calls (PBRJL) with over 173,700 options trading and also has a $0.43 dividend tomorrow. AT&T, Inc. (NYSE: T) saw heavy volume on the October 37.50 calls (TJU) with over 75,900 options trading. Research In Motion Limited (NASDAQ: RIMM) moved heavy volume on the October 100 calls (RULJT) with over 38,600 options trading ahead of its earnings after market close today. There were also bearish option players on RIMM with it moving 26,200 October 90 puts (RFYVR) with options trading.

Kevin Kersten is an Options Analyst with InvestorsObserver.com. Disclosure note: Mr. Kersten owns and or controls a diversified portfolio of long and short positions that may include holdings in companies he writes about.

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One of the largest increases in short interest among NYSE traded stocks was seen in Best Buy (NYSE: BBY). Shares short rose by 22.3 million from July 13 to August 15, hitting 68.7 million. As of three days ago, shares in the retailer were down 8% for the month.

Investors are increasingly concerned about Best Buy's competition; Wal-Mart's (NYSE: WMT) consumer electronics business continues to grow, as does the success of Amazon.com (NASDAQ: AMZN) in the same business. Forbes recently wrote that Best Buy first-quarter results "missed the Street's forecasts as profits were dampened by competition that undercut margins." The demise of Circuit City (NYSE: CC) also worries Wall Street. Radio Shack's (NYSE: RSH) sales numbers were also awful in the last quarter.

Best Buy reaffirmed its annual sales and earnings targets during an analyst meeting last month, but there must be a large number of skeptics. Best Buy trades at only $44, near its 52-week low and well down from the high of $58.49.

It would appear that no one is inclined to believe Best Buy management right now and the shorts are taking advantage of that.

Douglas A. McIntyre is a partner at 24/7 Wall St.

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MOST NOTEWORTHY:

• Citigroup downgraded RadioShack (NYSE: RSH) to Sell from Hold on valuation as they believe shares have priced in a more aggressive top-line recovery than the company can deliver over the next 12 months and that margin improvement is likely to slow.

• Merrill downgraded Weyerhauser (NYSE: WY) to Neutral from Buy based on the tighter credit environment and the impact on a potential containerboard divestiture or merger.

• Matrix downgraded shares of Goodyear Tire (NYSE: GT) to Sell from Hold to reflect rising oil prices and negative fundamental trends.

• AG Edwards downgraded Hot Topic (NASDAQ: HOTT) to Sell from Hold to reflect negative performance momentum and a lack of back-to-school prospects.

• Credit Suisse downgraded Unilever (NYSE: UN, UL) to Underperform from Neutral as their analysis suggests the company continues to lose market share...

• Baird cut Franklin Electric (NASDAQ: FELE) to Underperform from Neutral.

• Bear Stearns downgraded Kyphon (NASDAQ: KYPH) to Peer Perform from Outperform.

• Jarden (NYSE: JAH) was cut to Neutral from Buy at Goldman.

• Citigroup downgraded PetroChina (NYSE: PTR) to Hold from Buy.

• Alacatel-Lucent (NYSE: ALU) was downgraded to Neutral from Buy at Goldman.

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MOST NOTEWORTHY:

• Citigroup believes Arthur J. Gallagher (NYSE: AJG) is at a disadvantage to smaller rivals who accept contingent commissions and lacks the global presence of larger competitors, and started shares with a Sell rating and $25 target.

• Friedman Billings believes Akamai (NASDAQ: AKAM) can leverage its broad product portfolio, global network deep pockets and extensive track record to remain the leader in the content delivery market, starting shares with an Outperform.

• Keefe Bruyette started coverage of three railcars with a Buy rating: Greenbrier (NYSE: GBX), Wabtec Corporation (NYSE: WAB) and FreightCar America (NASDAQ: RAIL)...

• Citigroup started Goodyear Tire (NYSE: GT) with a Buy rating.

• CIBC initiated Praxair (NYSE: PX) with a Sector Performer rating.

• Crucell NV (NASDAQ:CRXL) was initiated with an Outperform rating at Lehman.

• FTN Midwest initiated RadioShack (NYSE: RSH) with a Neutral rating.

• Cowen initiated Penwest Pharmaceuticals (NASDAQ: PPCO) with an Outperform rating.

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MOST NOTEWORTHY:

• Banc of America downgraded shares of RadioShack (NYSE: RSH) to Sell from Neutral and lowered their target to $18 from $26 as they believe cuts to labor costs and advertising expenses will make it more difficult to overcome declining wireless trends.

• Friedman Billings cut Visual Sciences (NASDAQ: VSCN) to Market Perform from Outperform on valuation. Citigroup downgraded Alcan to Hold from buy on the acquisition news.

• Soleil cut U.S. Celluar (AMEX: USM) to Sell from Hold on valuation.

• Westwood One (NYSE: WON) was downgraded to Sell from Hold at Citigroup based on management distractions and weak fundamentals...

• Cowen removed ImClone Systems (NASDAQ: IMCL) from its Focus List, as the firm believes Erbitux is now more in line with consensus but said financials remain uninspiring.

• Merrill cut Allstate (NYSE: ALL) and Black & Decker (NYSE: BDK) to Neutral from Buy.

• USB downgraded Frontline (NYSE: FRO) to Reduce from Neutral.

• Matrix cut Thor Industries (NYSE: THO) to Sell from Strong Buy.

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