On Wednesday, General Mills (GIS) will report earnings results for the fiscal third quarter. The cereal maker is expected to do okay. According to Earnings.com, net income is projected to be around 56 cents per share. If the company hits that number, then it will represent a decent bottom-line growth rate.

The stock has a couple things going in its favor. The 52-week high is currently set at $38.98. Shares closed on Monday at a price of $37.12, not far from the peak. In addition, the dividend yield of 3% is attractive.

Kraft Foods (KFT) has done well to sustain demand in the face of higher coffee prices brought on by rising commodity prices. Kraft is the world's second largest food and beverage company after competitor Nestlé. It also competes with PepsiCo (PEP), General Mills (GIS) and Kellogg (K).

Kraft manufactures both food and beverages, with beverages accounting for nearly 14% of our $32.58 price estimate for Kraft's stock, which reflects a small premium to market price. Chocolate, candy and gum constitute around 31% of our price estimate, with snacks adding 19% and grocery products representing another 14%.

Analyst Upgrades

• Aetna (AET) to buy from neutral at Goldman.
• Kellogg (K) to buy from neutral at UBS.
• PetSmart (PETM) to outperform from market perform at JMP Securities.
• NetApp (NTAP) and Scripps Networks (SNI) to buy from hold at Wunderlich.
• Thoratec (THOR) to buy from hold at Auriga.
• ArcelorMittal (MT) to overweight from neutral at HSBC.
• Bristol-Myers (BMY) to outperform from neutral at Cowen.
• Eaton Vance (EV) to neutral from sell at Ticonderoga.
• Adtran (ADTN) to buy from underperform at BofA/Merrill.

Two companies devoted to consumer products released earnings this week. One makes items used for cleaning, the other makes goods that you can actually eat.

We'll start with the cleaning-item concern. The Clorox Company (CLX), manufacturer of the iconic laundry bleach, issued results for its fiscal second quarter earlier today. At the time of this writing, shares were higher by 2.4% to a quote of $65.26. Volume was strong. The 52-week low for the stock is $59.07 and the 52-week high is $69. The one-year chart is, well ... not that great.

Analyst Upgrades

• Tiffany (TIF) to outperform from perform at Oppenheimer.
• Kellogg (K) to outperform from market perform at Wells Fargo.
• Citizens Republic (CRBC) to outperform from market perform at FBR Capital.
• Research in Motion (RIMM) to equal weight from underweight at Morgan Stanley.
• MWI Veterinary Supply (MWIV) and Elster (ELT) to overweight from neutral at Piper Jaffray.
• Paetec Holding (PAET) and Patterson-UTI Energy (PTEN) to buy from hold at Citigroup.
• New Gold (NGD) to outperform from market perform at BMO Capital.
• Aviat Networks (AVNW) to buy from hold at Needham.
• Abiomed (ABMD) to buy from hold at Jefferies.
• Animal Health (AHII) to outperform from neutral at RW Baird.
• PNM Resources (PNM) to overweight from neutral at JPMorgan.

Tuesday morning, Kellogg (K) announced that its third-quarter net income dropped 6% thanks to slumping cereal sales. In addition to the weakening cereal sales, Kellogg saw competition strengthen and continuing impact from a cereal recall.

First things first, the cereal king reported earnings of 90 cents per share ($338 million), which came in lower than last year's earnings of 94 cents per share ($361 million).

Analyst Upgrades

• Union Pacific (UNP) and Polycom (PLCM) were upgraded to outperform from market perform at Wells Fargo.
• Time Warner Cable (TWC) was upgraded to outperform from sector perform at RBC Capital.
• Cheesecake Factory (CAKE) was upgraded to neutral from underweight at JPMorgan.
• LaSalle Hotel (LHO) was upgraded to outperform from neutral at RW Baird.
• Graco (GGG) was upgraded to buy from hold at BB&T.
• Valley National (VLY) was upgraded to market perform from underperform at Keefe Bruyette.
• Credit Suisse (CS) was upgraded to hold from sell at RBS.
• U.S. Bancorp (USB) was upgraded to outperform from perform at Oppenheimer.
• Penn National (PENN) and Riverbed (RVBD) were upgraded to buy from hold at Jefferies.
• Goodrich (GR) was upgraded to outperform from neutral at Cowen.
• Amazon.com (AMZN) upgraded to buy from average at Caris.

Analyst Upgrades

• Merriman upgraded Penn National (PENN) to buy from neutral, citing the company's strong balance sheet and management team. The firm also raised its target range for shares to $34 to $37.60.
• BMO Capital upgraded Cooper Companies (COO) to outperform from market perform and raised its price target to $55 from $46. The firm sees upside to Street estimates and increased visibility.
• Argus upgraded Watson Pharma (WPI) to buy from hold based on valuation.
• Phillips-Van Heusen (PVH) was upgraded to conviction buy from neutral at Goldman.
• Allstate (ALL) was upgraded to overweight from neutral at JPMorgan.
• Weingarten Realty (WRI) was upgraded to neutral from underperform at BofA/Merrill.

Option traders appear to be setting up for a bullish move on TransDigm Group Incorporated (TDG). Traders plowed into 1,865 new call option contracts -- 84.77 times the average volume -- on the stock on Thursday. And we know that traders were eager to get into this trade because 96% of the trades came in on the ask price.

TransDigm has been hitting 52-week highs for a few days in a row now. The stock closed Thursday at $61.25, up 7.65% during the past month.

Investors pushed up call option prices in the medical instruments and supplies industry and pushed up put option prices in the diversified utilities industry Wednesday.

Any time the volatility skews above 1.00, it is an indication that calls are more expensive than puts. Typically, when calls are more expensive than puts, it means the demand for calls is greater than the demand for puts because investors believe the stock is going to rise in the future and they want to take advantage of that movement by buying calls.

The opposite is also true. Any time a volatility skews below 1.00, it is an indication that puts are more expensive than calls.

Here is a common sentiment about the stock market: "No fun at all. As I have said before, I believe it has turned into one big casino largely divorced from its original goal of providing capital to companies who produce something of value."

There's a lot of truth to what "granny" recently said to me in an e-mail. Fortunately she also noted "FYI Granny's up 5.86% + dividends." That would give her a gain of about 10% in the past ten months since I posted Where should granny put $50,000, suggesting a very conservative portfolio for an uncertain time.

Not only has she earned a very nice return, surpassing her CD account by 9.5% (20 fold), but she was able to do so with a great deal less volatility than the overall market most of us have lived through.

Analyst Upgrades

• Baird upgraded C.H. Robinson (CHRW) to outperform from neutral and has a $67 target on the stock. The firm upgraded shares citing growth opportunities given the capacity constrained environment.
• UBS upgraded Navistar (NAV) to buy from neutral, citing improved trucker preferences towards the company's engine technology.
• KeyBanc upgraded Crane (CR) to buy from hold based on valuation stabilization and potential upside in aerospace, among other reasons. The firm has a $39 target on the stock.
• United Therapeutics (UTHR) was upgraded to overweight from neutral at JPMorgan.
• Equifax (EFX) was upgraded to overweight from equal weight at Stephens.
• Brown & Brown (BRO) was upgraded to buy from hold at Citigroup.