Adobe Systems (NASDAQ: ADBE) will get its chance to impress investors this afternoon when it reports its first quarter numbers following the market close.

Going into this afternoon's earnings release, the company is expected to show earnings of 44 cents per share for its quarter ending February 27. For the same period last year, the company reported that it had earned 48 cents per share, so we are looking at the company possibly seeing an 8.3% year over year earnings decline.

Research firm Punk, Ziegel & Co is putting a "buy" rating on Citigroup (NYSE: C). The research firm feels that the bank is the best proxy for investing in the global investment industry and that its write-downs are secondary. Quoted by MarketWatch, the firm said "The stock allows one to invest in the world's financial growth better than any other company. Others perform in one part of the financial sector or operate in one portion of the world."

That comment may be akin to saying that if you are going to drown in quicksand, you might as well find the best quicksand available. Citigroup is hardly a strong investment and the fact that its business operations are global and that it operates in many sectors has nothing to do with whether the bank can do well over the next year.

Citigroup is being scuttled by huge write-offs in its mortgage-related investment portfolio. Earnings from other divisions in the company are not likely to offset this and the bank may have to raise more capital. The resulting dilution could certainly drive the price of the company's stock down. There have also been comments from Wall Street that the big bank may have to cut its dividend. That is likely to make it much less attractive to a certain category of "yield-minded" investor.

Citi shares could be hit by more write-offs and the need to bring in a large sum of new capital.

That hardly makes it a "buy."

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

Shares of PepsiCo Inc (NYSE: PEP) had a nice day today following this morning's upgrade from Sanford C. Bernstein & Co. The stock rose 1.4% to $64.10, picking up $0.89 on the day. It is currently trading close to its intra-day high of $64.30.

Bernstein Research analyst Robert van Brugge upgraded the stock to "outperform" from "market perform" and bumped up his price target from $74 to $77. The analyst said that he believes that investors have not looked closely enough at the stock's long-term growth potential which he believes is greater than its main competitor Coca-Cola Co. (NYSE: KO).

Brugge stated that he expects PepsiCo to see 8 percent operating profit growth over the next five years and argues that Coke might miss its 6 percent to 8 percent growth target. The technicals on PepsiCo are bearish but show a possible trend reversal and the stock gets a positive 4 STARS (out of 5) buy rating.

For a hedged trade on PepsiCo, I would consider a July bull-put credit spread below the $60 range. The stock has not traded under the $60 level since last June and shows some solid support above $61. The trade could be risky if the company disappoints on its earnings due out on the 25th, but with the company's solid support and 200 day moving average sitting at $63 it should be protected against any disappointing news.



Michael Fowlkes has worked as a stock trader for seven years and spent the last two years working as an analyst for the online investment advisory service Investor's Observer.