The intriguing capital appreciation story continues with Avon Products (AVP), first discussed here on May 6, 2009 at a price of $23.12, but the stock is beginning to try investors' patience.

From a technical standpoint, Avon's shares rose substantially out of a summer trough near $25, vaulting to about $36 in early autumn, only to plunge back to $29. It's a volatile, problematic stock pattern, and typically, the stock would have been kicked, but Avon's sector experience and the no-loss $24 sell/stop loss keeps the trade in play, for now. I'll review Avon again in about a month or as conditions warrant.

It is mind boggling that Hugo Chavez, the authoritarian President of Venezuela is racing towards a mock socialist political system when the two largest socialist regimes in the world, China and Russia, have done the opposite. Even our long standing communist adversary (now trading partner) Vietnam entered the 21st Century on a capitalist influenced spring loaded economic boom.

BusinessWeek reports in its latest edition that the Chavez government has been taking privately held supermarkets under government control:

Tupperware (TUP) issued Q4 numbers after the bell on Monday. Sales were higher by 10% once benefits from currency exchange were eliminated. Adjusted earnings per share increased 16% to $1.22. According to Earnings.com, net income came in 18 cents better than the average estimate.

Bravo! Tupperware, which counts Newell Rubbermaid (NWL) and Avon Products (AVP) as colleagues, is also doing well with cash flow. In fact, you'll notice from the release that management is increasing its stock buyback by $200 million.

Estee Lauder (EL) closed at $49.76. EL is expected to report Q2 EPS on January 28th. February option implied volatility is at 31, April is 29; near its 26-week average of 31, according to Track Data, suggesting non-directional price movement.

Avon Products (AVP) closed at $32.26. AVP February put option implied volatility is at 35, April puts are at 32, versus its 26-week average of 32, according to Track Data, suggesting non-directional price movement.

Elizabeth Arden (RDEN) closed at $16.27. RDEN is expected to report Q2 EPS in early February. February and June option implied volatility of 59 is below its 26-week average of 72, according to Track Data, suggesting decreasing price movement.

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

Avon Products (NYSE: AVP - option chain) shares are rising today after the company reported a second-quarter profit this morning of $82.9 million, or 19 cents per share. Excluding one-time items, AVP earned 38 cents per share, beating analysts' expectations of 34 cents per share. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on AVP.

AVP opened this morning at $30.31. So far today the stock has hit a low of $14.40 and a high of $32.77. As of 11:40, AVP is trading at $32.36 up $2.62 (8.8%). The chart for AVP looks neutral and S&P gives AVP a neutral 3 STARS (out of 5) hold ranking.

"Although I'm very leery of the market now, I'll continue to buy gradually when specific stocks are attractive," says Jack Adamo. In Insiders Plus, he looks to a new idea: Avon Products (NYSE: AVP).

"Avon's stock got whacked when fellow paint sellers, Estee Lauder and Elizabeth Arden, guided earnings lower, and analysts lowered earnings expectations for Avon to about $1.90 for 2009.

"They're probably still too optimistic, but I'm buying the stock anyway. We owned Avon for almost 3 years, and sold it for $43.47 in September for a 69% profit.

Analyst upgrades:

• Baird upgraded Regal-Beloit (NYSE: RBC) to Outperform from Neutral based on valuation and growth expectations.
• Black & Decker (NYSE: BDK) and Lennar (NYSE: LEN) were upgraded to Buy from Neutral at UBS based on valuation.
• Kroger (NYSE: KR) and Public Storage (NYSE: PSA) were added to Goldman's Conviction Buy List.
• CIBC upgraded Biovail (NYSE: BVF) to Sector Performer from Sector Underperformer.
• Abercrombie & Fitch (NYSE: ANF) was raised to Neutral from Underperform at Cowen.

Analyst downgrades:

• Merrill downgraded Campbell Soup (NYSE: CPB) to Neutral from Buy and expects marketing and promotional spending to limit earnings growth in 2009 and 2010. The firm lowered their target to $35 from $42.
• Mechel Steel (NYSE: MTL) was cut to Underweight from Equal Weight at Morgan Stanley to reflect declining coal demand.
  
• Friedman Billings downgraded shares of Legg Mason (NYSE: LM) to Underperform from Market Perform on liquidity concerns given the Legg Mason's leveraged balance sheet and falling EBITDA. The firm lowered their target to $7 from $11.

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.

"Beauty is as beauty does, the saying goes, and Avon Products Inc. (NYSE: AVP) has delivered a beautiful earnings report," says Jack Adamo in his industry-leading Insiders Plus. Here's his latest.

"Despite a 14% increase in advertising (or perhaps, because of it) the company delivered EPS up 26%. In North America, the only underperforming region, revenues continued their slow downward slide. But active representatives increased for the first time in ages, which may brighten the future on the company's home turf.

"International sales continued to soar. Latin America was 19% higher in local currencies, and 32% higher after translation into the American Peso, also known as the U.S. Dollar. In Central & Eastern Europe, first-quarter revenue rose 17% (6% in local currency). Revenue in China grew 29% (19% local). Only Japan dragged things down a bit with its 2% gain.

Avon (NYSE: AVP) delivered not a bag of cosmetics to Wall Street, but a batch of growing earnings. Total revenues for the first quarter were up beautifully, rising 14% to $2.5 billion. Earnings per diluted share likewise did the double-digit-increase dance, rocketing 26% to $0.43.

Now, I would have liked the report a lot more if the company had indicated in its cash flow statement that everything was positive -- unfortunately, that was not to be, as operational cash flow was, in fact, negative. Avon needed to use $41 million for its operating activities during the quarter. Well, one thing I can say is that it's a lot less than the cash needed to fund last year's operations -- Avon burned through over $160 million in the comparable period. A check of the latest 10K shows that, while operational cash flow has been decreasing over the last few years, it has remained positive, so since this is the first quarter of the new fiscal year, we can wait to see how cash flow shapes up as the quarters go by.

Avon competes with companies like Procter & Gamble (NYSE: PG), Revlon (NYSE: REV) and Estee Lauder (NYSE: EL). As I've stated in the past, Procter & Gamble is more my kind of consumer-products business, but I'll give Avon its due since it does have a good product portfolio backing its brand and a devoted base of users. The stock is not too far off from its 52-week high as of this writing, and so long as it can keep sales growing and fight inflationary pressures, it should be a decent long-term bet.

Disclosure: I don't own shares in any of the companies mentioned; positions can change at any time.

TheStreet.com's Jim Cramer says investors should be negative, but they have to keep an eye out for rallies.

Have you looked at the charts lately? I still carry them around and, frankly, have been reluctant to sit down and look at one after another the way Helene Meisler has for years and years.

But I have forced myself to do so since this year began just to remind myself that this bear market is a vicious one and you better have a darned good reason to buy a stock because you are most likely going to lose money otherwise.

The charts are amazingly bad. The vast majority of stocks are simply awful. You eliminate the oils, the golds, the ags, you have nothing, I mean, really, nothing. You can see that an Avon (NYSE: AVP) (Cramer's Take) could rally or maybe a Coke (NYSE: KO) (Cramer's Take), and you can make a case for the utilities to bottom on interest rate compares but that's really about it. The banks? They all look like they have no bottom.

Forget about being in the beauty business. This overhaul at Avon Products, Inc. (NYSE: AVP) isn't going to be pretty in the least. As part of its previously announced restructuring plan, 2,400 jobs will be cut and the company plans to save about $430 million per year. The plan will cost $530 million, with $460 expensed through the end of 2007 and the remainder being charged between now and the end of 2009. Additionally, the company's going to write of $110 in inventory as it says it's simplifying product lines by getting rid of low selling products.

This turnaround plan for Avon was announced in November of 2005 and is focused on creating efficiencies in the operation, thereby cutting costs. They're also focusing on the "career opportunity" for representatives and they're trying to make it more attractive.

Avon is one of the oldest multi-level marketing (MLM) companies around. It was established in 1886, a time when door-to-door sales were a common way of purchasing items that were needed. Over time, the business model has evolved to more of home party model and one-on-one selling that doesn't necessarily involve knocking on stranger's doors.

Apple, Inc. (NASDAQ: AAPL) has wooed Avon Products, Inc. (NYSE: AVP) CEO Andrea Jung to its board of directors, giving the Apple board a count of eight members as of January 2008. At this point in time, this really does make sense for Apple and the decision is a great one. Here's why.

Jung, who has been with Avon for over 11 years, is deeply entrenched into how direct sales and marketing strategies apply to women. Although Apple's iPod has been geek-lust for many teenage boys and 20-somethings (among other demographics), the marketing of the iPod has almost always involved women in some form.

Don't think of Avon (NYSE: AVP) as that traditional door-to-door cosmetics company. Avon has entered the globalization and digital age.

Avon is in the midst of a restructuring aimed at increasing efficiency and widening the company's sales venues, and so far, so good.

Direct selling (5.3 million representatives) continues to be Avon's base, but catalogs, mall kiosks, a day spa, and a web site create a diverse retail presence.

Avon has also reduced its costs by moving manufacturing to lower-cost regions in the world, and via sales force productivity increases. Meanwhile, the company has amped-up its product base (cosmetics, fragrances, toiletries, jewelry, apparel, and home furnishings) as part of it plan to attract younger customers and to expand its global operations footprint.

Further, analysts are keeping an eye on marketing costs, which always increase in any brand expansion plan. Provided that expenses don't get out of hand, margins should improve in 2008 - a major reason why the stock's appeal is increasing in Wall Street circles. The Reuters F2007/F2008 EPS consensus estimates for Avon are $1.50/$2.08.

The First Call mean rating for the stock is: Buy. [16 firms.] Mean 2008 target: $46.70. [high: $55, low: $39.]

Stock Analysis: Avon is a moderate-risk stock not suitable for low-risk investors. Investors with an investment horizon longer than 1 year should be rewarded by Avon's shares. Sell / Stop Loss if you were to purchase shares in this company: $26.

Procter & Gamble Co. (NYSE: PG), Colgate-Palmolive Co. (NYSE: CL) and Avon Products Inc. (NYSE: AVP) all reported strong results today because the weak dollar has made their products attractive to consumers overseas.

Net income at Procter & Gamble rose 14% to $3.08 billion, or 92 cents a share, compared with $2.7 million, or 79 cents, a year earlier. Revenue surged 7.5% to $20.5 billion. Excluding a tax-benefit, profit was 90 cents. Analysts had expected profit of 89 cents on revenue of $20.23 billion. P&G expects profit for the current quarter of between 95 to 97 cents; Wall Street expectations are for 97 cents. The company raised its full year outlook by 2 cents to $3.46 to $3.49 to reflect a one-time tax benefit.

"The fiscal year is off to a good start," said A.G. Lafley, Chairman of the Board and Chief Executive Officer, in the earnings release. "P&G continues to deliver broad-based top and bottom-line growth across its portfolio of businesses and geographies. This momentum, along with a robust initiative pipeline for the year, gives us confidence that P&G will deliver another strong year of growth."

Shares of P&G, which are up about 12% this year, fell in pre-market action.