Sara Lee (NYSE: SLE) closed at $10.54. Unilever (NYSE: UN) agreed to buy SLE's personal-care and European detergent unit for $1.88 billion. SLE's board of directors authorized a $1 billion share repurchase program. SLE October option implied volatility is at 39, November is at 38; near its 26-week average of 38 according to Track Data, suggesting non-directional price movement.

MSCI Brazil Index (NYSE: EWZ) is recently up 37 cents to $65.04 in pre-open trading. Brazil Bovespa Stock Index is up 0.1%. EWZ call option volume of 14,379 contracts compares to put volume of 22,765 contracts. EWZ October option implied volatility is at 37, October and January is at 38; below its 26-week average of 45, according to Track Data, suggesting decreasing price movement.

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

U.S. stock futures inched higher Friday morning, perhaps trying to break the two-day losing streak. After Thursday stocks fell on an unexpected drop in sales of existing homes, this morning's new home sales will no doubt be in focus, as will durable goods orders data.

Also in focus this morning are Research In Motion (NASDAQ: RIMM)'s disappointing earnings reported late Thursday and Unilever's (NYSE: UL) $1.88 billion offer for the global body care unit of Sara Lee (NYSE: SLE).

[Update: durable goods orders data actually fell in August, catching the Street by surprise. Futures now indicate a lower start.]

General Electric (NYSE: GE) closed at $16. GE is scheduled to host a Global Research Analyst Meeting on September 17. GE options were active on volume of 812,432 contracts. GE October option implied volatility is at 47 and December is at 43; below its six-week average of 55, according to Track Data.

Sara Lee (NYSE: SLE) closed at $10.00. SLE's analyst meeting today will review fiscal 2009 and discuss future growth strategies and initiatives. SLE October and January option implied volatility of 34 is below its 26-week average of 38, according to Track Data, suggesting decreasing price movement.

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

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

• Applied Materials Inc. (NASDAQ: AMAT) posted better-than-expected Q3 results, sending shares higher.
• AutoDesk Inc. (NASDAQ: ADSK) reported better-than-expected Q2 earnings, sending shares higher.
• Blockbuster Inc. (NYSE: BBI) had another disappointing quarter as same-store sales declined.
• CIT Group Inc. (NYSE: CIT) delayed its Q3 report due to ongoing debt restructuring and a possible bankruptcy.
• Dr Pepper Snapple Group Inc. (NYSE: DPS) Q2 earnings came in well ahead of Wall Street expectations.

Maker of tasty pastries, lunch meat, and shoe polish (?) Sara Lee Corp. (NYSE: SLE) surprised Wall Street this morning when it reported a fourth-quarter loss of $14 million, or two cents per share. Last year in the same reporting period, SLE lost $672 million, or 95 cents per share.

Not only were these numbers an improvement on a year-over-year basis, but they topped analysts' expectations as well. Excluding charges related in part to its Spanish bakery business, the firm banked 29 cents per share, topping per-share estimates of 24 cents. Revenue was off 10% during the quarter to $3.16 billion.

Don't look now, but Sara Lee (NYSE: SLE) is up about 20% in the past month. People gotta eat, and, thanks to the recession, they're opting to eat at home more often.

Sara Lee reports earnings on August 12, and analysts expect earnings per share to be 5 cents less than a year ago. Last quarter, the company blew out the estimate by nearly 40%.

With sentiment mixed (only a third of analysts rate the shares a "buy"), another beat this quarter should keep the rally intact.

Buy SLE call options.

Next: Earnings Trade #4

Beating the Street at the earnings game is all about knowing the market's true expectations for a stock.

Knowing the market's expectations -- not just the analyst expectations -- for a stock will often provide the edge necessary to turn earnings season into a profit opportunity.

The more data and trends you can look at to determine not only what investors expect, but also how investors are positioning themselves for the expected move, the better.

Analyst upgrades:

• Deutsche Bank upgraded Portland General Electric (NYSE: POR) to Buy from Hold on valuation as it finds the risk/reward on shares attractive at current levels. The firm raised its target price to $22 from $20.
  
• FBR Capital upgraded Abercrombie & Fitch (NYSE: ANF) to Outperform from Market Perform after channel checks indicated recent sales are driving increased traffic and easing market share losses. The firm raised its target price on shares to $37 from $21.
• Barclays upgraded Yahoo (NASDAQ: YHOO) to Overweight from Equal Weight as it believes the company is well positioned for a rebound in advertising and that the valuation is compelling at current levels. The firm raised its target on shares to $20 from $15.
• Kohl's (NYSE: KSS) was raised to Overweight from Market Weight at Thomas Weisel.
  
• U.S. Steel (NYSE: X) and CB Richard Ellis (NYSE: CBG) were upgraded at Goldman to Neutral from Sell.
  
• Dolby Laboratories (NYSE: DLB) was upgraded at JP Morgan to Overweight from Neutral.

TheStreet.com's Jim Cramer says companies saddled with high debt loads can be found in every sector in every business.

Overleveraged. Too much debt. Need to pay down debt. How many times have you read that story?

You read it so much because it plays out every day and plays havoc with stock picking almost every time you see a savory stock down on its luck.

This weekend, as I went through the charts, I was amazed at how low some stocks have gone, stocks that I would normally say to just take a flyer on, but turn out to have so much debt, short- and long-term, that they are just too dangerous.

Consider these perhaps poisonous morsels:

This post is part of a special annual report -- Top Stock Picks '09 -- in which TheStockAdvisors.com asked 75 leading newsletter advisors to select their favorite investment for the new year.

"To paraphrase its marketing slogan: 'Nobody shouldn't like Sara Lee (NYSE: SLE),'" says Steve Ralston, consumer products sector expert at Zacks Investment Research.

"From the sales of staple products, consumer non-durable companies generate solid cash flow, with which management can enhance shareholder value through share repurchases and dividend increases.

"Recently restructured consumer non-durable companies are especially attractive, particularly if they are well-managed, trade at a single-digit P/E, and yield more than 4%.

"My favorite stock for 2009 is Sara Lee. Sara Lee announced a 5-year restructuring plan (the Transformation Plan) 3-1/2 years ago. The company has been right-sized, having divested unprofitable and low margin businesses.

"Even in tough economic times, Sara Lee (NYSE: SLE) should fair well thanks to its offering of non-cyclical goods," says quantitative analyst Vahan Janjigian, editor of The Forbes Growth Investor.

"Sara Lee is a leading producer of branded foods, beverages, and personal care products. Roughly 50% of sales are generated outside of the U.S. Leading brands include Ball Park, Hillshire Farm, Jimmy Dean, Sara Lee, State Fair, Earth Grains, and Senseo brand coffee products.

"Management launched a comprehensive restructuring plan in 2005 to focus on core products and maximize operating efficiencies. These actions yielded $218 million in annualized cost savings in fiscal 2008.

"Food commodity costs soared earlier this year. However, SLE has been able to pass costs to customers through price increases. Furthermore, it has benefited from growing volumes. Fiscal Q4 net sales grew 12.2% year-over-year to $3.5 billion.

"With its earnings announcement, management issued fiscal 2009 guidance. It expects net sales to grow 4-6% year-over-year to $13.7-14 billion and pro forma earnings to grow 8-18% to 90-98 cents per share.

"Since issuing guidance, economic conditions have deteriorated significantly. This could lead to increased trading down activity to lower-priced brands or private-label goods.

"Also, the strengthening dollar has turned the foreign exchange tailwind into a headwind. Yet food commodity and energy costs have fallen significantly, which could provide margin relief for the company."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.

In the News:
Major U.S. Stocks Drop to Decade Lows
As U.S. Stocks continue their downward spiral many of the most well-known name are plunging to decade or more lows. General Motors is almost at a 70-year low. Among the other companies that have fallen and not able to get up include General Electric, Harley Davidson, Alcoa, Macy's, Microsoft, Southwest Airlines, Sara Lee, News Corp. Starwood Hotels, Kodak, Gannett, Intel, Newell Rubbermaid, International Paper and more.
http://www.247wallst.com/2008/11/major-sp-stocks.html

The New Subprime: FHA-Backed Loans
The subprime wolves are back. The same people whose reckless practices triggered the global financial crisis are onto a similar scheme that could cost taxpayers tons more.
http://www.businessweek.com/magazine/content/08_48/b4110036448352.htm?chan=top+news_top+news+index+-+temp_top+story

In a conversation with an attorney friend of mine, who happens to be a woman, she asked for some general financial guidance. During the course of the conversation it occurred to me that women need to save more than men. There are many reasons for this, here are a few:

The first and most obvious reason women need to save more than men is that they live longer -- often without the support of a significant other. Living longer and living alone cost more money.

Second of all, women still do not have complete earnings parity with men. Some of this has to do with job type and some with history. But nevertheless, we are not there yet. If there is a 15% disparity, then a woman is starting at a disadvantage whether saving for her retirement in the future or for buying a gallon of gas today. This can only be made up by saving more and investing more. This is a worthy goal except that with less resources the difficulty is exacerbated.

In the News:
Investments That Pay You Every Month
Expect a steady flow of cash from these three portfolios.
Investments That Pay You Every Month - Kiplinger.com

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

• Cisco Systems Inc. (NASDAQ: CSCO) beat Q2 expectations but offered a weak outlook.
• Clear Channel Communications Inc. (NYSE: CCU) higher Q1 profits failed to beat expectations.
• Crocs Inc. (NASDAQ: CROX) just missed EPS estimates but raised its full-year guidance.
• CVS Caremark Corp. (NYSE: CVS) strong Q1 results only met Wall Street expectations.
• eResearch Technology Inc. (NASDAQ: ERES) beat Q1 expectations and offered Q2 and full-year guidance.
• Foster Wheeler Ltd. (NASDAQ: FWLT) beat estimates due to a boost in its power plant segment.
• Internet Brands Inc. (NASDAQ: INET) reported strong Q1 results on ongoing M&A.
• Midway Games Inc. (NYSE: MWY) widened its loss in Q1 but beat expectations.
• News Corp. (NYSE: NWS) Q3 earnings jumped on a one-time transaction with Liberty Media.
• NVIDIA Corp. (NASDAQ: NVDA) missed Q1 estimates but was upgraded by analysts anyway.
• NYSE Euronext (NYSE: NYX) reported a first-quarter profit above analysts' estimates.
• Sara Lee Corp. (NYSE: SLE) Q3 profits surged but fell short of analysts' expectations.
• World Wrestling Entertainment Inc. (NYSE: WWE) posted strong results but couldn't cover its dividend.

Upcoming results to watch for include Sprint Nextel (NYSE: S), XM Satellite Radio (NASDAQ: XMSR), Sirius Satellite Radio (NASDAQ: SIRI), Electronic Arts (NASDAQ: ERTS), Whole Foods (NASDAQ: WFMI), Wal-Mart (NYSE: WMT), Deere & Co. (NYSE: DE), Toll Brothers (NYSE: TOL), Applied Materials (NASDAQ: AMAT), JC Penney (NYSE: JCP), Macy's (NYSE: M), Nordstrom (NYSE: JWN), Hewlett-Packard (NYSE: HPQ), Abercrombie & Fitch (NYSE: ANF).

Visit AOL Money & Finance for more earnings coverage.