Bruce Watson over at sister site DailyFinance.com highlighted some news that is actually more important than many people might believe. At first glance, it's almost a trite little curiosity. Upon further inspection, its vital nature becomes compelling.

The article discussed the elimination of personal check-writing at retail points of sale. A few Whole Foods Market (NASDAQ: WFMI) locations, as well as 70 Fresh & Easy supermarkets in California, are no longer accepting checks as a viable form of payment. Whole Foods is apparently taking the idea out for a test run, but Fresh & Easy seems to be more serious about the idea.

In a difficult economic environment, it is often wise for investors to consider stocks in more defensive and relatively recession-resistant sectors. And one such area is food and beverage stocks.

As the long-standing market maxim goes, consumers can pull back on spending for vacations, remodeling, and new cars, but they still need to eat and drink.

In that light, I turned to nine leading newsletter advisors who serve up their current favorite ideas in the food and beverage sector:

The Federal Trade Commission has temporarily suspended its antitrust challenge to Whole Foods Market's (NASDAQ: WFMI) 2007 acquisition of Wild Oats to allow the company to explore settlement possibilities.

David Wales, the chief competition enforcer at the FTC, told (subscription required) The Wall Street Journal that "We're going to roll up our sleeves and take a look at what they're offering. We're hopeful that a settlement can be reached."

Whole Foods (NASDAQ: WFMI - option chain) shares have moved higher today after privately-held Yucaipa Companies, LLC announced it has acquired a 7 percent stake in WFMI. Yucaipa is also considering other strategic moves, which might go as far as a takeover of the company. Any speculation in WFMI being a buyout target should give this stock a floor, and 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 WFMI.

WFMI opened this morning at $10.72. So far today the stock has hit a low of $10.27 and a high of $10.89. As of 12:30, WFMI is trading at $10.75, up 74 cents (7.4%). The chart for WFMI looks bearish and S&P gives WFMI its lowest 1 STARS (out of 5) strong sell ranking.

For a bullish hedged play on this stock, I would consider a February bull-put credit spread below the $8 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 11.1% return in just six weeks as long as WFMI is above $8 at February expiration. Whole Foods would have to fall by more than 26% before we would start to lose money. Learn more about this type of trade here.

WFMI hasn't been below $8 since November and has shown support around $9 recently.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in WFMI.

Yuppie organic food market, Whole Foods (NYSE: WFMI) has been struggling with the slow economy. After all, the company that has jokingly been referred to as Whole Paycheck for its high prices has lost business as people have cut back on spending. Now, a private equity firm has stepped in to do a rare Private Investment in Public Equity (PIPE) deal -- buying 17% of its shares which boosted Whole Foods stock 19.8% after-hours.

Who would do such a thing? An affiliate of Leonard Green Partners, Green Equity Investors V, spent $425 million for its Whole Foods PIPE. Why did Leonard Green do this? Does it expect to take an active role in managing the company and somehow pull it out of its growth slump? Or is its 17% stake simply a passive investment -- and a bet that Whole Foods has bottomed out?

I think Leonard Green may have gotten a bargain. Whole Foods stock fell 6.2% during regular trading after it lowered its 2009 EPS estimates from $1.04 to between $0.95 and $1 -- it earned 82 cents a share in 2008. And based on that lower growth rate, Whole Foods trades at a PEG ratio of 0.6 -- on a P/E of 9.8 with earnings forecast to grow 16% in 2009.

Whole Foods Market (NASDAQ: WFMI) shares are trading higher today after an analyst at Morgan Stanley upgraded the stock to Equal-weight from Underweight, as noted by Eric Buscemi. If you agree with Morgan Stanley and 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 WFMI.

After hitting a one-year high of $53.65 in October, the stock hit a one-year low of $20.18 last week. WFMI opened this morning at $23.27. So far today the stock has hit a low of $22.37 and a high of $24.06. As of 12:45, WFMI is trading at $22.50, up $1.12 (5.2%). The chart for WFMI looks bearish and steady, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.

For a bullish hedged play on this stock, I would consider an August bull-put credit spread below the $19 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 15.6% return in just four weeks as long as WFMI is above $19 at August expiration. Whole Foods would have to fall by more than 15% before we would start to lose money.

WFMI hasn't been below $20 at all in the past year and has shown support around $21 recently. This trade could be risky if the company's earnings (due out on 8/5) disappoint, but even if that happens, this position could be protected by the support the stock might find at its year low between $20 and $21.

Brent Archer is an options analyst and writer at Investors Observer. At publication time, Brent neither owns nor controls positions in WFMI.

Whole Foods Market (NASDAQ: WFMI) is expected to report Q1 EPS on February 19.

THNK says: "Recession could prove not as bad for WFMI as some might expect."

WFMI March option implied volatility of 55 is above its 26-week average of 42 according to Track Data, suggesting larger price movement.

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

Whole Foods Market (NASDAQ: WFMI) is banning plastic bags from its 270 locations. The switch to a choice between reusable bags and paper will take effect on Earth Day, April 22.

It's certainly a bold move and demonstrates a lot of concern for the environment. It will also spruce up Whole Foods' image as an environmentally-conscious retailer and generate a ton of free publicity for the company, starting with the New York Times story.

Whole Foods has served as a trend-setter for the larger grocery chains, and this move could inspire stores like Kroger (NYSE: KR) and Safeway (NYSE: SWY) to make similar switches, depending on how it works out.

During its trial runs, Whole Foods found that eliminating plastic only led to a 10% increase in paper bag use, demonstrating that consumers tend to switch to the reusable bags.

That's good for the environment, and it also cuts costs: Even Wal-Mart (NYSE: WMT) has taken notice by phasing in reusable bags as a third option. The plastic bag seems destined for obsolescence.

The 21st century may be the end of the "Plastics, young man!" era.

Whole Foods Market Inc. (NASDAQ: WFMI) stock is trading lower this afternoon as the company approaches its Q4 earnings release tomorrow after the close. Whole Foods has been wholly unspectacular since early 2006 when investors stopped looking at it like a growth stock and more like a low margin supermarket stock. Over the last two years and eight earnings announcements, WFMI has missed estimates four times, beaten three times and matched once. Investors are expecting more of the same lackluster results tomorrow and are pushing the stock lower today. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on WFMI.

After hitting a one-year low of $36 in August, the stock has recovered some recently and hit a one-year high of $53.65 in October. This morning, WFMI opened at $44.86. So far today the stock has hit a low of $42.18 and a high of $45.09. As of 2:05, WFMI is trading at 42.45, down 2.86 (-6.3%). The chart for WFMI looks neutral but deteriorating, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bearish hedged play on this stock, I would consider a January bear-call credit spread above the $55 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 4.6% return in nine weeks as long as WFMI is below $55 at January expiration. Whole Foods would have to rise by more than 29% before we would start to lose money. Learn more about this type of trade here.

WFMI hasn't been above $55 at all in the past year, and has shown resistance around $50 recently. This trade could be risky if the stock finds support around $44 and moves higher again, but even if that happens, this position could be protected by the resistance WFMI formed when it topped out just above $53 in October.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in WFMI.

After Whole Foods Market (NASDAQ: WFMI) CEO John Mackey bizarre antics prompted an SEC investigation and widespread media hoopla, the company's board of directors has decided on a new policy. Top executives and directors will now be explicitly prohibited from posting on online forums about the company, its vendors, or its competitors, except on Whole Foods-sponsored sites.

Happily, the change does not prohibit them from posting about other topics. So Mr. Mackey will still be able to compliment his own hairstyle while posting anonymously.

It's kind of bizarre that Whole Foods even had to add this to its code of ethics, and it seems unlikely that this kind of thing will ever happen again at any normal company. Of course, it happens every day over at Overstock.com (NASDAQ: OSTK), where Director of Communications Judd Bagley routinely attacks critics on Yahoo! message boards and Wikipedia.

At least it's good to see that the board at Whole Foods takes ethics seriously, and is willing to take actions to ensure that its executives don't do anything to jeopardize the company's reputation or get it in trouble with regulators.

Overstock directors: Where are you?

MOST NOTEWORTHY: Lululemon, Domino's Pizza, Kenexa, Omniture and News Corp were today's noteworthy initiations:

• Lululemon (NASDAQ: LULU) was initiated with a Neutral rating at Merrill Lynch. CIBC believes the company is well-positioned to replace its Canadian success in the U.S. market and started shares with a Sector Outperformer rating and $39 target. The stock was started at Wachovia with a Market Perform rating on valuation.
• Citigroup finds Domino's Pizza (NYSE: DPZ) compelling for long-term investors given the company's solid cash flows, above-average margins, and international growth opportunity. The firm initiated shares with a Buy rating and $22 target.
• RBC Capital started shares of Kenexa Corporation (NASDAQ: KNXA) with a Sector Perform rating and $32 target, citing lack of visibility into the company's product roadmap.
• RBC initiated shares of Omniture Inc (NASDAQ: OMTR) with an Outperform rating and $33 target. The firm believes Omniture is well-positioned given cross selling opportunities, best in class products, strong secular trends, and expanding client roster.
• News Corporation (NYSE: NWS) was initiated with a Buy rating and added to Stifel's Select List. The firm believes the FOX TV Network, stations and FOX News can garner an incremental recurring 100% margin retransmission and affiliate fees totaling $1B by 2010, adding that its sum-of-the-parts model for News Corp captures the value of $8B of "hidden" assets, yielding a fair market value of $30-$31.

OTHER INTIATIONS:

• CRT Capital initiated shares of Navistar (NASDAQ: NAVZ) with a Buy rating and $75 target.
• JP Morgan started shares of Dice Holdings (NYSE: DHX) with an Overweight rating.
• Think Equity started shares of Whole Foods Market Inc (NASDAQ: WFMI) with an Accumulate rating and $51 target.

"Whole Foods Market (NASDAQ: WFMI) has rallied recently due to two main factors: a better-than-expected earnings report released in early August coupled with a breakthrough on WFMI's deal to acquire rival Wild Oats Markets," notes Paul Tracy.

The editor of StreetAuthority Market Advisor, plains, ""Whole Foods reported same-store sales growth of 7% in the second quarter. That's not quite as strong as the 9% reported a year ago, but it still represents solid growth and was above what analysts had expected."

He adds that wWhile earnings fell on a year-over-year basis, that was due mainly to costs associated with WFMI's new store openings. These costs, he suggests, represent an investment in future growth; analysts had already been expecting these higher start-up costs, and Whole Foods' earnings actually beat consensus estimates by two cents.

In spite of John Mackey's most self-destructive efforts at getting the merger he wanted so badly blocked,. it appears that it will go through. Although the FTC says it will appeal, Whole Foods Market (NASDAQ: WFMI) appears poised to acquire rival Wild Oats (NASDAQ: OATS). Shares of Whole Foods are up 6.3% on the news after-hours. Wild Oats, the buyout target, is seeing its stock soar almost 20%.

According to the Associated Press,U.S. District Judge Paul L. Friedman's filed a 93-page document (sealed because if contains trade secrets) denying the FTC's plea to block the deal. The FTC argued that the merger would lead to higher prices for consumers, and appeared to have compelling evidence based on internal documents from the company. The deal was referred to as "Operation Goldmine" at Whole Foods, and the company planned to shutter more than 25% of Wild Oats stores. Emails from Mackey to the company's directors referred to the acquisition as a way to "eliminate a threat" and avoid "price wars".

Mackey has got to be thrilled that the deal is going through. Aside from the obvious strategic benefits to his company, the failure of the deal would likely have been pinned on him. He would have become known as "Motor Mouth Mackey": The man who helped the FTC block an important acquisition because he couldn't shut his trap.

MOST NOTEWORTHY: The truck industry, Roo Group (RGRP), Accuray (ARAY) and TomoTherapy (TTPY) were today's noteworthy initiations:

• In the trucking industry, FTN Midwest initiated shares of Cummins Inc (NYSE: CMI) and Navistar International Corp (NASDAQ: NAVZ) with Hold Ratings and Oshkosh Truck Corp (NYSE: OSK) and PACCAR Inc (NASDAQ: PCAR) with Buy ratings.
• ROO Group (NASDAQ: RGRP) was initiated with a Buy rating and a $3.75 target at Think Equity, which believes RGRP is positioned to capitalize as the Internet continues to grow as a broadcast medium for video.
• Soleil initiated shares of Accuray Inc. (NASDAQ: ARAY) with a Buy rating and $30 target. The company is Soleil's top pick in radiation oncology.
• Soleil also initiated shares of TomoTherapy Inc. (NASDAQ: TTPY) with a Buy rating and $25 target, as the firm believes all-in-one imaging and radiation oncology system in HiArt could become the new standard of care.

OTHER INITIATIONS:

• Elan Corp (NYSE: ELN) was initiated with an Outperform rating and $40 target at Leerink Swann, which added shares to the firm's Focus List as it is positive on the Tysabri opportunity.
• Cree Inc (NASDAQ: CREE) was initiated with a Buy rating and $50 target at Amtech, as the firm believes the time for LED adoption has finally arrived and will accelerate in the future.
• Nollenberger initiated shares of ZipRealty (NASDAQ: ZIPR) and Move, Inc (NASDAQ: MOVE) with Neutral ratings.
• CIBC World Markets initiated shares of Whole Foods Market Inc. (NASDAQ: WFMI) with a Sector Underperformer rating and $38 target, expecting the company to be impacted by increasing competition.
• BMO Capital Markets initiated shares of Intel Corp. (NASDAQ: INTC) with an Outperform rating and $10 target.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

MOST NOTEWORTHY: Dell (DELL), Boyd Gaming (BYD) and OmniVision Tech (OVTI) were today's noteworthy upgrades:

• Dell Inc. (NASDAQ: DELL) was upgraded to Buy from Hold at AG Edwards to reflect the strong April quarter results.
• Boyd Gaming Corp. (NYSE: BYD) was upgraded to Outperform from Market Perform at Wachovia due to ongoing improvement in the locals business through revenue growth and cost reductions, expected benefits at Borgata from the summer season, and a new hotel tower at the property.
• OmniVision Technologies Inc. (NASDAQ: OVTI) was upgraded to Buy from Hold at American Technology and to Buy from Neutral at Merriman to reflect the company's improved revenue and gross margin outlook.

OTHER UPGRADES:

• Universal Compression Partners (NASDAQ: UCLP) was upgraded to Buy from Hold at AG Edwards, as the firm believes the potential for additional asset acquisitions creates likely upside to estimates.
• UBS upgraded shares of Norsk Hydro (NYSE: NHY) to Buy from Neutral and shares of Lear (LEA) to Neutral from Reduce.
• Cowen upgraded VistaCare Inc. (NASDAQ: VSTA) to Outperform from Neutral and added shares to the firm's Focus List. Cowen believes the company's decision to review strategic alternatives will unlock value.
• Matrix USA upgraded shares of Whole Foods Market Inc. (NASDAQ: WFMI) to Sell from Strong Sell based on valuation.
• CHLM upgraded shares of 3D Systems Corp. (NASDAQ: TDSC) to Accumulate from Neutral.
• Cantor upgraded shares of NMS Communications Corp. (NASDAQ: NMSS) to Buy from Hold on potential restructuring benefits.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).