Valentine's Day makes or breaks the flower industry. What happens if the recession causes lovers to cut back and just exchange greeting cards? Among other businesses, 1 800 Flowers (NASDAQ: FLWS) may have the most important week of its year ruined and investors in the stock may watch it fall and stay down until the next big holiday.

FLWS is already off to $2.31, just above its 52-week low and way off the period high of $9.25.

The 1 800 Flowers troubles says a great deal about the breadth of this recession. A box of roses probably costs about $40, depending on where someone lives and how the rose crop has done recently. That is not a lot of money to spend on a gift, especially one that is probably important. But, if people won't put out that money, what will they buy? The answer is probably almost nothing.

MOST NOTEWORTHY: 1-800-Flowers.com, Ctrip.com International, 51job and Choice Hotels were today's noteworthy initiations:

• Nollenberger started shares of 1-800-Flowers.com (NASDAQ: FLWS) with a Buy rating and $14 target and believes shares are undervalued at current levels given the company's compelling growth prospects, strong cash flow generation, and solid balance sheet.
  
• Bear believes Ctrip.com (NASDAQ: CTRP) is the best positioned online travel company ahead of structural changes and consolidation in China's fragmented travel agency industry. The firm initiated shares with an Outperform rating and $80 target.
  
• Bear expects 51job (NASDAQ: JOBS) to benefit from China's increasing Internet user base due to the internet's broadening reach among job seekers, resuming coverage with an Outperform rating and $28 target.
  
• Goldman started Choice Hotels (NYSE: CHH) with a Buy rating and $45 target, as they are positive on the stock given unit growth and minimal capital needs, among other reasons.

OTHER INITIATIONS:

• Thomas Weisel initiated On Semiconductor (NASDAQ: ONNN) with an Overweight rating and $15 target.
  
• Broadpoint initiated Ariba (NASDAQ: ARBA) with a Buy rating and $15 target and Ultimate Software (NASDAQ: ULTI) with a Neutral rating.
  
• Merrill started shares of Savient Pharmaceuticals (NASDAQ: SVNT) with a Neutral rating.

MOST NOTEWORTHY: Nokia, 1-800-Flowers.com, Wadell & Reed, Westwood One and Cisco Systems were today's noteworthy upgrades:

• Morgan Stanley upgraded shares of Nokia Corporation (NYSE: NOK) to Overweight from Underweight, as they expect higher-than-expected volumes and increasing market share to drive outperformance in the second half of 2007.
  
• CIBC upgraded shares of 1-800-Flowers.com (NASDAQ: FLWS) to Sector Outperformer from Sector Performer. CIBC upgraded shares when they transferred coverage on the name.
  
• Wadell & Reed Financial (NYSE: WDR) was upgraded to Outperform from Market Perform from Keefe Bruyette based on strong investment returns.
  
• Westwood One Inc (NYSE: WON) was upgraded to Buy from Hold at Deutsche Bank to reflect a likely new deal with CBS Corporation (NYSE: CBS), feasibility of a sale to private equity and signs of a turnaround in the company's network business.
  
• Cisco Systems Inc (NASDAQ: CSCO) was added to Matrix's Focus List, as the firm believes the company is "perfectly positioned" to profit from the coming growth and demand for network infrastructure...

OTHER UPGRADES:

• GOL Linhas Aereas Inteligentes SA (NYSE: GOL) and TAM SA (NYSE: TAM) were upgraded to Neutral from Underweight at JP Morgan.
  
• IAC InterActiveCorp (NASDAQ: IACI) was upgraded to Buy from Neutral at Merrill Lynch.
  
• Merrill also raised shares of Heidrick & Struggles International (NASDAQ: HSII) to Neutral from Sell.
  
• JP Morgan upgraded Sonic Solutions (NASDAQ: SNIC) to Overweight from Neutral.

A month after Mattel's (NYSE: MAT) massive recall of lead-paint contaminated toys, Toys "R" Us is joining the party. The toystore juggernaut is recalling 27,000 Chinese-made paint and crayon sets. The wooden box contains lead, as do some of the paints.

Obviously these toy recalls are bad news for the company's involved -- Mattel and stores that rely heavily on low-cost imported goods. If parents get scared and transition to higher-quality products, these companies will suffer.

That's where 1-800-Flowers.com (NASDAQ: FLWS) comes in. The company also owns HearthSong and Magic Cabin, which could see increased sales if consumers flock to quality. These companies manufacture toys that are more classical and, I would argue, better for kids than a lot of the cheap stuff -- lead paint concerns aside.

MOST NOTEWORTHY: Mattel (MAT), UnitedHealth (UNH), Alcoa (AA), 1-800-Flowers.com (FLWS) and Marathon Oil (MRO) were today's noteworthy upgrades:

• Piper upgraded shares of Mattel (NYSE: MAT) to Outperform from Peer Perform on valuation and improving fundamentals and notes that product recalls have historically not had a lasting impact on sales.

• Goldman upgraded UnitedHealth (NYSE: UNH) to Neutral from Sell on valuation and expectations for improved profitability in 2H07.

• Alcoa (NYSE: AA) was upgraded to Outperform from Market Perform at Friedman Billings on valuation and expectations for a favorable report next week.

• JMP Securities has increased confidence in 1-800-Flowers.com's (NASDAQ: FLWS) management initiatives to drive leverage and operating margins following the Q4 report, upgrading shares to Outperform from Market Perform.

• Lehman upgraded shares of Marathon Oil (NYSE: MRO) to Overweight from Equal-Weight on valuation and expectations for strong oil and gas production growth...

OTHER UPGRADES:

• NBTY Inc (NYSE: NTY) was upgraded to Neutral from Underperform at JP Morgan.

• ThinkEquity upgraded F5 Networks (NASDAQ: FFIV) to Buy from Accumulate.

• Goldman upgraded the oil services sector to Attractive from Neutral based on the recent pullback; Sunoco (NYSE: SUN) and Hess (NYSE: HES) were also upgraded to Buy from Neutral.

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

Private equity firm Apollo Management bought out Affinion in 2005. It was part of a spin-off from Cendant.

Now, Apollo has filed a public offering for Affinion -- so as to take some money off the table.

Founded about 35 years ago, Affinion develops marketing and loyalty campaigns for major companies around the world. The services span from direct mail to Internet approaches.

The model is based mostly on recurring revenues, which Wall Street likes. What's more, the operating margins are strong and the company pumps out tons of cash flow. Last year, revenues were about $1.1 billion and adjusted EBITDA was $264 million.

Affinion has more than 5,200 affinity partners. Some include JP Morgan Chase and Co. (NYSE: JPM), Bank of America (NYSE: BAC), Royal Bank of Scotland, Société Générale, Staples Inc. (NASDAQ: SPLS), 1-800-FLOWERS.Com (NASDAQ: FLWS), and Priceline.Com, Inc. (NASDAQ: PCLN).

This is likely to be a big IPO -- raising in excess of $600 million. So far, no underwriters have been announced.

To read the prospectus, you can go to the SEC website. And, if you want to see some more recent IPO filings, click here.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

Just in time for Mother's Day, direct marketers have swamped my mailbox.

In the last week or so junk mail targeting Mom has piled up. There's a Costco Wholesale Corp.'s (NASDAQ: COST) magazine with a story titled Mom Inc. on the cover. Tiffany & Co. (NYSE: TIF) is selling some lovely trinkets between baby blue covers. 1-800-flowers.com, Inc.(NASDAQ: FLWS) has a catalog full of roses, chocolate and other things that "Mom wants." The local taxidermist even sent me a coupon for a deal on moose stuffing (this is Alaska) for the special day.

Is it my imagination or has the amount of junk mail increased?

It's up. In 2006 companies sent more than 114 billion direct -mail pieces. That's about 15% more than five years earlier, according to the United States Postal Service. The Postal Service and I don't see eye to eye when it comes to credit card offers, coupons and bulky catalogs. The federal agency loves direct mailers because they generate big bucks for the service. It even has a magazine, Deliver, whose mission is to help direct mailers find faster, better ways to my mailbox, and wallet. In 2006, for the first time ever, the volume of bulk mail, which is another name for direct mail, exceeded all first class.

But there is a fledging company taking on the Postal Service and the giants of direct marketing. Hollywood celebrity Matt Damon sits on its board Greendimes.com will take your name off direct mail lists, unwanted credit card solicitations, and the dozens or hundreds of catalogs that arrive yearly. It will keep tabs on direct marketers to keep you off the lists and even plant a tree for you every month, but not on your property. The cost: $36 a year.

Sounds like a good gift for Mom. It's a lot less than diamonds from Tiffany's. Or a stuffed moose.

MOST NOTEWORTHY: The more notable downgrades today included Playboy Enterprises (PLA), Embratel Participacoes (EMT) and Choice Hotels Int'l Inc (CHH):

• Bank of America and UBS downgraded Playboy Enterprises (NYSE: PLA) to Neutral from Buy, citing limited visibility.

• Citigroup downgraded Embratel Participacoes ADS (NYSE: EMT) to Sell from Hold on expected lower liquidity following Telfonos de Mexico SA ADS (NYSE: TMX) voluntary tender expiration.

• Choice Hotels Int'l Inc (NYSE CHH) was downgraded to Underperform from Peer Perform at Bear Stearns following the company's Q4 report and guidance.

OTHER DOWNGRADES:

• VeraSun Energy Corp (NYSE: VSE) was downgraded to Sell from Neutral at Goldman based on relative valuation.

• Goldman Sachs also downgraded 1-800-Flowers.com Inc (NASDAQ: FLWS) to Sell from Neutral based on valuation.

• Piper Jaffray downgraded Buffalo Wild Wings Inc (NASDAQ: BWLD) to Market Perform from Outperform citing difficult year-over-year comps and increased chicken wing prices.

• CIBC downgraded Nasdaq Stock Market Inc (NASDAQ: NDAQ) to Sector Performer from Outperformer.

• ThinkEquity downgraded Zoltek Companies inc (NASDAQ: ZOLT) to Accumulate from Buy.

• BMO Capital Markets cut Weyerhaeuser Co (NYSE: WY) to Market Perform from Outperform based on valuation.

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

Note: The Daily Option Update is provided by Stock Options Specialist Paul Foster of theflyonthewall.com.

Volatility Index S&P 500 Options-VIX up .71 to 11.81.

Blue Nile Inc. --(NASDAQ:NILE) February straddle bid up; reflecting $3.50 risk into tonight's EPS. NILE, a leading online retailer of diamonds and jewelry, will report EPS after the close tonight. NILE is recently down $1.44 to $39.82. PIPR says: "We maintain our underperform rating. We would be more constructive if NILE is able to demonstrate flat gross margins with maintaining near 20% revenue growth." NILE February 40 straddle is at $3.65, above its theoretical value of $1.83 according to Track Data, suggesting larger fluctuations.

The Knot, Inc -- (NASDAQ:KNOT) February straddle pricing in a $2.50 move into 2/13 EPS & Outlook. KNOT, the nation's leading wedding resource that reaches more than one million engaged couples each year, will report EPS on 2/13. KNOT is down .95 to $29.75. KNOT February 30 straddle is at $2.75, above its theoretical value of $1.46 according to Track Data, suggesting larger fluctuations.

FTD Group, Inc. (NYSE:FTD) implied volatility is low; FTD hired GSCO on 11/16 to explore sale. FTD, a leading provider of floral-related products, is recently down .42 to $19.44. FTD hired GSCO to explore a possible sale on 11/16/06. FTD has a market cap of $551 million dollars with long term debt of $318 million. FTD reported 2006 revenues of $465 million. FTD over all option implied volatility of 31 is near its 26-week average according to Track Data, suggesting non-directional price fluctuations.

1-800-Flowers.com, Inc. (NASDAQ:FLWS) option implied volatility flat; FLWS near record into Valentine's Day. FLWS is recently up 0.16 cents to $7.72. FLWS over all option implied volatility of 52 is near its 26-week average according to Track Data, suggesting non-directional price risk.

Option volume leaders today were: Google (NASDAQ:GOOG), NYSE Group (NYSE:NYX), Intel (NASDAQ:INTC) and Apple Inc. (NASDAQ:AAPL).