It has been a pretty rocky earnings season so far, and on Monday morning, it will be Archer-Daniels-Midland's (NYSE: ADM) turn to step up to the plate. The company will be reporting its fiscal fourth quarter earnings Monday before the market opens, and analysts are expecting to see the company come in with $0.59 per share.

The last time that the company reported earnings was back on May 1 when it put up rather disappointing numbers for its fiscal third quarter. During its third quarter, the company was however able to show higher than expected revenues, but the stock got hit pretty hard due to the lower than expected earnings.

After its disappointing third quarter the stock gradually traded lower through all of May and June before making a modest rebound during the first half of July trading. The past few days have been tough on the company (as well as the entire market) so Monday's results will be critical in determining whether the company's recent rebound will in fact carry into August.

One of the main reasons for the company's less than stellar third quarter was the cost of corn. That could lead traders to think that it may be a better quarter this time around as corn prices have definitely eased somewhat. Corn prices have declined of late, mainly as a result of a report from the U.S. Department of Agriculture stating that U.S. farmers had planted 19 percent more corn this season than a year ago. While that is great news, another crop that the company relies on is soybeans, and this year it is estimated that there were 15% less crops planted than last year.

Let me introduce my Yankee Doodle Dandy portfolio, a compilation of red, white and blue stocks for investors to consider as they celebrate our nation's independence.

Regardless of your views on the Iraq war, there's no denying that defense stocks including Lockheed Martin Corp. (NYSE: LMT), Northrop Grumman Co. (NYSE: NOC), Raytheon Co. (NYSE: RTN) and General Dynamics Corp. (NYSE: GD) are reasonably valued. This is especially noteworthy considering that defense spending will need to be maintained at pretty high levels for years to come in order to replace equipment that's been worn out from combat. President Bush is proposing to spend a record $439 billion in fiscal 2007 on defense and another $42.7 billion on homeland security.

Lockheed, the maker of the F-16, seems especially cheap, trading at a forward multiple of 14.6. Its shares have only gained 4.6% this year even though the company reported better-than-expected first-quarter results and raised earnings guidance. Missile and defense electronics company Raytheon, up less than 3%, is in the same situation.

Investors often overlook the huge businesses that Lockheed and Raytheon have in areas outside of defense, including computer systems and air-traffic control. The managements of both companies also have vastly improved over the past few years. Northrop and General Dynamics have always been pretty well run.

Boeing Co. (NYSE:BA), notably the second-largest defense contractor, also looks worth snapping up. Its stock is up less than 3% this year, which is surprising considering how well it's rebounded against European rival Airbus. The company trades at a forward multiple of 17.7.

At last, U.S. investors who want a piece of the ethanol game may have a pure play that's solidly profitable. South America's largest ethanol company, Cosan, filed Monday to raise $2 billion through the United States financial markets. According to Dow Jones, Cosan will use about $650 million in IPO proceeds for a new ethanol plant. $500 million to expand existing sugar and ethanol plants, and $325 million to build plants to generate electricity from left over sugar cane.

Cosan reported net income of $346.5 million in fiscal year 2007, and its size and strength have led to speculation that Archer Daniels Midland (NYSE: ADM) may make a run at buying the company. The plans for an IPO make that seem less likely however.

Cosan may have missed the speculative ethanol bull market of last year that sent companies like Pacific Ethanol (NASDAQ: PEIX) into the stratosphere, but the fact that Cosan actually makes money -- and lots of it -- gives it the making of a potentially very successful IPO.

Cosan's sugar-based ethanol is probably more efficient than the corn-based ethanol that is being produced in the United States, but huge government tariffs and farm subsidies will put the company at a disadvantage in the United States for now. But if gas prices continue to soar and pressue mounts in Washington to remove the tarrifs, Cosan would probably become a major player in the ethanol market here. If that happens, investors who scoop up Cosan at the IPO will be richly rewarded.

MAJOR PAPERS:

• Kohlberg Kravis Roberts & Co. is planning an initial public offering, following in the footsteps of arch rival Blackstone Group (NYSE: BX), reported the Wall Street Journal (subscription required).
  
• Archer-Daniel-Midland Company (NYSE: ADM) is expected to enter the sugar cane ethanol business in Brazil, including the possible purchase of Cosan, Brazil's largest ethanol producer, reported the Wall Street Journal.

OTHER PAPERS:

• British energy company BP plc (NYSE: BP) will agree to the demands of the Russian government to give up its stake in the $20B Kovykta gas project, reported the U.K. Times.
• From BusinessWeek's "Inside Wall Street" column:
• Bulls and bears argue over where it is time to own Deere and Company (NYSE: DE) stock, some see the stock hitting $150, some believe the party is over.
• Document Security Systems Inc (NYSE: DMC) has nine patented technologies to help protect documents and printed products from brand and security fakers, leading Brookhaven Capital Management to believe it will reach $50-a-share over the next two years.
• WBB Securities believes Cleveland BioLabs Inc (NASDAQ: CBLI) is likely by summer's end to get a U.S. Department of Defense contract for its radiation protection compound called Protectan or CBLB502.

WEBSITES:

• CNN.com reported that a 16-year-old girl had both of her feet severed in an accident on the free-fall ride "Superman Tower of Power" at Six Flags Inc's (NYSE: SIX) Kentucky Kingdom amusement park yesterday.

Linear thinking is a killer on Wall Street. If demand for corn-based ethanol is expected to increase, why not invest in corn. US oil supplies are crashing, Gulf of Mexico natural gas reserves are dropping and the US still has an aversion to nuclear power.

In addition, ethanol usage in gasoline is expected to increase from a 10% to a 14% blend, placing additional pressure on the demand for corn. Go long corn? I wouldn't.

According to Archer Daniels Midland Company (NYSE: ADM) executives -- makers of a lot of ethanol -- during its most recent earnings conference call, they are not too concerned about corn prices. Why? Because price always takes care of demand. Higher prices will lead to farmers shifting production to corn to reap higher profits, which will lead to much more corn and lower prices over time.

It's pretty clear that the share price of food processing giant Archer Daniels Midland Co. (NYSE: ADM) is closely tied to corn prices. Must be good news for ADM then that corn prices are up as demand for ethanol is at an all time high, and corn syrup seems to be in everything these days. Of course, things are never that clear cut.

It seems the high price of corn syrup may have beverage makers and others reconsidering their choice of sweeteners. And the high price of corn appears to be leading to a surplus in the supply of corn, which of course is bound to drive prices back down.

So where does that leave ADM when it reports Q1 2007 earnings next week? According to Thomson Financial, the current consensus estimates are for revenue of $9.45 billion, or 62 cents per share. Last quarter the actual EPS was 67 cents; a year ago, 46 cents. The analysts' consensus recommendations is buy, with seven out of nine of them rating ADM a buy or strong buy. That's a change from the consensus recommendation of hold, just a month ago. The mean price target is $41.25. ADM closed Thursday at $39.03.

The share price has been trending upward this past quarter from a 52-week low of $30.20 in early January, and after slumping in 2006 after the 52-week high of $46.71 last May. The five-year growth rate is 34.2%, and the current PE is 14.68.

Cramer likes ADM, listing it as one of his ethanol picks. What's not to like? Thomson Financial also points out that ADM has offered upside surprises of more than 10% in its last four quarters, and the average return one month after ADM's positive surprises is 2.6%.

The question is, will the self-proclaimed Supermarket to the World offer up another positive surprise on Tuesday?

MAJOR PAPERS:

• Highlights from today's Wall Street Journal (subscription required):
• Dell Inc (NASDAQ: DELL) has been accused in an investor lawsuit of improper accounting in its partnership with Intel Corporation (NASDAQ: INTC).
• News Corporation's (NYSE: NWS) MySpace is looking to forge partnerships to enter the Chinese market.

OTHER PAPERS:

• The U.K. Times reported that Rio Tinto plc (NYSE: RTP) has warned that the future of its only operation in the U.K. is bleak, with negotiations on its future having failed to deliver a solution.
• The Washington Post said, according to a National Intelligence report, that the situation in Iraq will get worse and the United States has little control over it.
• Investor's Business Daily's "New America" column mentioned Heelys (NASDAQ: HLYS) positively, saying there is plenty of room for growth in the wheeled sneaker market, although cautioning it could be a fad like rollerblades or the Razr scooter before it.
  
• From BusinessWeek's "Inside Wall Street" column:
• Weyerhaeuser Company (NYSE: WY) named Debra Cafaro, a well-regarded REIT executive, to its board, sending a "clear signal that Weyerhaeuser will be looking at moving its huge timberlands into a REIT," says Mark Wilde of Deutsche Bank.
  
• Archer Daniels Midland Company (NYSE: ADM) should rise to $6 a share this year, says Carl Birkelbach, president of Birkelbach Investment Securities
  
• Access Pharmaceuticals' (NASDAQ: ACCP) two cancer drugs -- one of which, MuGard, has already been O.K.'d by the Food & Drug Administration -- are catching the eye of investors.