Countrywide Financial Corp. (NYSE: CFC) implied volatility Elevated as CFC share price retraces.

• CFC, the largest U.S. home mortgage lender, is recently up $1.44 to $39.92 on renewed buyout chatter.
  
• CFC May option implied volatility of 48 & June at 41 is above its 26-week average of 34 according to Track Data, suggesting larger price risks.

Urban Outfitters Inc. (NASDAQ: URBN) implied volatility suggests increased risk into EPS.

• URBN, a lifestyle merchandising company, announced 1Q same store sales fell 2%.
  
• URBN will report EPS on 5/10. BUCK has an accumulate rating on URBN with a $31 price target.
  
• URBN May option implied volatility is at 53, June is at 45; above its 26-week average of 42 according to Track Data, suggesting larger risk.

Option volume leaders today are: Dendreon Corp. (NASDAQ: DNDN), AK Steel Holding Corp. (NYSE: AKS), Motorola Inc. (NYSE: MOT) and Cisco Systems Inc. (NYSE: CSCO).

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

Color me a cynic, but I have a hard time feeling the sincerity in Steve Jobs' promise to make Apple (NASDAQ: AAPL) a more environmentally friendly business, with initiatives like eliminating certain toxic substances from its products and promoting recycling. Jobs issued a five-page memo discussing the new, greener Apple.

If this announcement had come a year ago, in a time when Apple wasn't in the midst of an options-backdating scandal with accusations flying all the way up to Mr. Jobs, I'd applaud the company's efforts. In a way, I still do. But it also seems like a diversionary tactic to draw attention away from governance scandals surrounding the company.

Portfolio.com wrote that, "As Home Depot and Wal-Mart have recently discovered, announcing green initiatives in the face of bad news is a great way to divert media attention from things like $100 million CEO pay packages and ongoing battles over worker wages and benefits."

The magazine also points out that Al Gore's presence on the board of directors may have contributed to the decision, although Gore recently backed the board in opposing shareholder proposals that would have called for more stringent environmental standards at the company.

Wal-Mart's CEO Earned 6.3 Million in 2006

That was the headline for today's Wall Street Journal's coverage of Wal-Mart (NYSE: WMT) CEO Lee Scott's pay package. The piece goes on to say that "Wal-Mart Stores Inc. Chief Executive Lee Scott received base pay, bonuses and perquisites of $6.3 million last fiscal year in addition to grants of restricted stock and options valued at $17 million, the retailer disclosed in its proxy filing yesterday."

Here's the thing: If Lee Scott earned 17 million dollars in restricted stock and options, why does the headline say that he earned 6.3 million? The Federal Accounting Standards Board and SEC now require companies to expense stock options when they are issued, and this make sense. As Warren Buffett said "If options aren't a form of compensation, what are they? If compensation isn't an expense, what is it? If expenses shouldn't go into the calculation of earnings, where in the world should they go?"

So I ask the Wall Street Journal: Why not report Mr. Scott's earnings the same way the company reports them in its proxy statement?

Amazon.com, Inc. (NASDAQ: AMZN) May implied volatility at 43, July at 33; suggests near term Risk. AMZN is recently trading at $45.08. AMZN will report earnings on 4/24. AMZN May option implied volatility of 43 is above its 26-week average of 37 according to Track Data, suggesting larger price fluctuations.

US Steel (NYSE: X) option implied volatility Flat at 40 into EPS as X near Record High. X is recently down .93 to $107.15. X will report EPS on 4/24. X May option implied volatility of 40 is near its 26-week average according to Track Data, suggesting non-directional price fluctuations.

Merck (NYSE: MRK) implied volatility suggests non-directional risk into earnings and outlook. MRK will to report earnings on 4/19. MRK over all option implied volatility of 20 is near its 26-week average according to Track Data, suggesting non-directional price fluctuations.

Option volume leaders today are: Yahoo! Inc. (NASDAQ: YHOO), Johnson & Johnson (NYSE: JNJ) and Intel Corp. (NASDAQ: INTC).

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

Ipsco Inc. (NYSE: IPS ) -- volatility up; indicates more Risk; release of discussions of acquisition. IPS, a low cost producer of energy tubular sans steel plate, is recently up $15 to $156.19. IPS says "it is currently in discussions that could lead to a potential acquisition of the company." IPS has a market cap of $6.9 billion with long-term debt of $879 million. IPS reported 2006 total revenue of $3.7 billion. IPS call option volume of 4,751 contracts compares to put volume of 1,506 contracts. IPS April option implied volatility is at 47, May is at 43 above its 26-week average of 38 according to Track Data, suggesting larger price risks.

Raser Technologies (AMEX: RZ) -- option implied volatility Elevated on agreements win; RZ rallies 19%. RZ has pending patents and proprietary intellectual property covering breakthrough technologies. RZ is up $2.00 to $9.20. RZ entered into a series of agreements with UTC Power to provide up to 135 PureCylce geothermal power systems for three Raser power plants. RZ call option volume of 4,366 contracts compares to put volume of 2,255 contracts. RZ May option implied volatility of 128 is above its 26-week average of 108 according to Track Data, suggesting larger price risks.

Option volume leaders today are: Dendreon Corp. (NASDAQ: DNDN), Citigroup Inc. (NYSE: C), Washington Mutual (NYSE: WM) and Research in Motion (NASDAQ: RIMM).

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

Clear Channel Comm (NYSE: CCU) -- options priced as if shareholders will approve $37.60 buyout. CCU struck a deal to sell itself for $37.60 to Thomas H. Lee Partners and Bain Capital LLC in November of 2006. Two-thirds of CCU shareholders are needed to vote for the deal on 4/19 for the sale to be completed. CCU options are active today. CCU April 35 calls are priced as if CCU will be trading at $36.40 by 4/20. May, July and October are priced as if two-thirds of CCU's shareholders will approve the $37.60 sale.

Comcast (NASDAQ: CMSCK) -- option implied volatility suggests non-directional Risk into Rally. CMCSK is recently up $1.03 to $27.29. Bloomberg ran a story with a headline of "Comcast Chief Roberts says his business is 'On Fire'." CMCSK overall option implied volatility of 24 is near its 26-week average of 23 according to Track Data, suggesting non-directional risk.

Option volume leaders today are: Dendreon Corp. (NASDAQ: DNDN), Alcoa Inc. (NYSE: AA), General Electric (NYSE: GE) and Neurochem Inc. (NASDAQ: NRMX).

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

Washington Mutual Inc. (NYSE: WM) implied volatility and put volume Elevated into 4/17 EPS.
WM, a consumer and small business bank with assets of $346 billion, is recently up $0.05 to $39.30. Keefe Bruyette says that WM "has a large share of production in Alt A products and, in our view, has a large share of its balance sheet exposed to mortgage." WM call option volume of 2,552 contracts compares to put volume of 30,969 contracts. WM April option implied volatility is at 43, May is at 27 -- above its 26-week average of 22 according to Track Data, suggesting larger price fluctuations.

Stamps.com Inc. (NASDAQ: STMP) April 20 calls & puts active at Elevated prices into EPS.
STMP, a provider of Internet based postage solutions, is recently trading at $14.44. STMP will announce EPS on April 19th. STMP April 15 calls have traded 79 times on transaction volume of 1,369 contracts above its open interest of 277 contracts. STMP April 15 puts have traded 35 times on transaction volume of 560 contracts, above its open interest of 24 contracts according to Track Data. STMP April 20 straddle is priced at $1.65 above its theoretical value of 0.95 cents, suggesting larger price risk into EPS.

Option volume leaders today are: Dendreon Corp. (NASDAQ: DNDN), Freeport McMoran Copper & Gold Inc. (NYSE: FCX), General Electric Co. (NYSE: GE) and Qualcomm Inc. (NASDAQ: QCOM) .

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

Main market news here

General Motors Corp. (NYSE:GM) Chief Executive Rick Wagoner said he doesn't expect further consolidation in the U.S. auto industry because of overcapacity, throwing cold water on any rumors that his company might try to buy DaimlerChrysler AG's (NYSE:DCX) unit. GM has plenty of its own problems.

From the 20-20 hindsight department. Following the Valentine's Day weather delays that left thousands stranded on planes that never took off, JetBlue Airways Corp. (NASDAQ:JBLU) has hired former FAA official Russell Chew as its chief operations officer effective March 19. That job was previously handled by President David Barger who will be Chew's boss.

The SEC is trying to figure out if and how it should penalize companies that backdated stock options, according to the Wall Street Journal (subscription required). It's not an easy question since many of the cases are running against a five-year statute of limitations, the paper said.

U.S. stock markets may continue their slide from last week as investors brace themselves for the latest report on the service sector from the Institute for Supply Management. Stock futures are down following a sell-off in markets in Europe and Asia.

The closely watched Institute for Supply Management's index of non-manufacturing businesses is due to be released at 10 a.m. New York time. A Bloomberg News survey estimates that the index probably fell to 57 in February from 59 the previous month.

Pundits are divided over whether the market was headed down an Olympic grand slalom ski course or a gentle bunny slope. Speeches later today by Fed Governor Kevin Warsh, Fed Governor Randall Kroszner and Fed Bank of St. Louis President William Poole might help clarify matters. Then again, they may just further confuse them.

In corporate news:

The Blackstone Group has emerged as the leading bidder for DaimlerChrysler AG's (NYSE:DCX) Chrysler, according to the Detroit News. Reuters reports that other potential buyers include General Motors Corp. (NYSE:GM) and Cerberus Capital Management.

Alltel Corp. (NYSE:AT) is stepping up efforts to tell itself to larger rivals such as Verizon Communications Inc. (NYSE:VZ) or Sprint Nextel Corp. (NYSE:S), according to the Wall Street Journal.

Gee, I wonder which one of the many bidders is leaking this stuff to the media.

Research in Motion Ltd. (NASDAQ:RIMM) is hitting the reset button on its earnings. The maker of the Blackberry is restating results from fiscal years 2004, 2005, 2006 as well as the first quarter in 2007 following a review of stock-option grants.

Computer glitches forced delays yesterday for passengers on U.S. Airways Group Inc. (NYSE:LCC). Passengers at Charlotte-Douglas International Airport waited at terminals for as long as an hour and a half because U.S. Airways' automated kiosks didn't work. The airline should phone up JetBlue Airways Corp. (NASDAQ:JBLU) Chief Executive David Neeleman for pointers on apologizing to passengers.

Steve Jobs, the genius behind the iPod and Mac, isn't above the law. The Apple Inc. (Nasdaq:AAPL) co-founder is already facing questions about backdated options at that company. Now comes word from the Wall Street Journal that he helped negotiate a deal with noted Pixar animator John Lasseter that included a "large stock options grant with an especially well-timed date."

The exact nature of Jobs involvement isn't clear but this certainly doesn't look good. Lasseter's grant is one of several awarded by Pixar at yearly lows, which has raised questions about whether they were improperly backdated, the paper said.

If Jobs had a role in backdating options at either Apple or Pixar, he deserves to be punished. I don't think prison is in order, but the SEC may not allow him to be an officer of a publicly traded company for a period of time. For Apple shareholders, though, this doesn't have to be the end of the world.

Jobs could take on a role at Apple similar to what Martha Stewart has at Martha Stewart Living Omnimedia Inc. (NYSE:MSO). Stewart's company has been run very well by Chief Executive Susan Lyne since Stewart had her own legal problems. This has turned out to be a very good thing for shareholders because it's allowed the diva of domesticity to focus on doing what she does best. Of course, Stewart still has a huge say in the company since she is also a major stockholder.

These days, history isn't being kind to Apple Inc. (Nasdaq:AAPL) CEO Steve Jobs. That's ironic considering how much he's obsessed about what people think of him and the company he co-founded.

Jobs has another legal battle of historical proportions on his hands besides the options backdating scandal. Bloomberg News is reporting (via the Los Angeles Times) that Jobs has lost a battle to demolish a
Spanish Colonial style mansion he owns near San Francisco.

A preservation group sued after the city of Woodside and Jobs didn't consider alternatives to destroying the 17,250-square foot mansion, which Jobs bought 21 years ago and has never liked, Bloomberg says.

Perhaps Jobs can figure a way to preserve the Jackling House, named after copper magnate Daniel C. Jackling. Maybe he can restore it its original glory. While he's at it, he might take a stab trying to mend the damage to his reputation caused by the options backdating mess.

These have got to be tough times for the tech mogul. Jobs, who made his fortune looking ahead, now has to spend quite a bit of time looking back.

With the current legal problems that are occurring in Apple-land, the story of current CEO Steve Jobs continues to unfold in mysterious ways. Does Jobs really have a "reality distortion field" that he uses to win consumers over to the Apple view of the world? According to many in the tech community, he does. But that power may not extend to possible back-dating of Apple Computer, Inc. (NASDAQ:AAPL) stock options.

Tomorrow, Jobs will take center stage in his familiar role as keynote presenter/semi-magician at MacWorld, which is famously held at the same time as the Consumer Electronics Show in Vegas. Only Jobs could pull that off in a move that he knows will most likely garner the world's attention.

Is Jobs completely in the clear regarding his involvement in the possible resetting of start dates for company stock options for himself and others? Even Al Gore found "no misconduct" in possible back-dating involving Jobs recently. Is Jobs being treated unfairly in this situation since he has made the star of Apple shine so bright for so many investors and consumers? Managing Director Alan Johnson of Johnson Associates says that "He knew what he was doing. It wasn't 'the dog ate it.' He backdated the options on purpose and the committee said it will give him a free pass." Yikes -- that's one against Jobs. But how many for him?

Back in the 1990s, sitting on a publicly-traded tech company's board could be a ticket to a fat payday.

But those days are over. Options, a primary source of corporate riches for board members, have lost their allure. Now companies must expense options. And the backdating scandal is forcing firms to rethink their use.

So it should be no surprise that IBM has announced that it will no longer grant options to its directors.

Simply put, why deal with the headaches?

Instead, IBM will provide its directors with an annual fee of $200,000, up from $100,000.

The good news is that IBM is encouraging its board members to take compensation in the form of shares. This should help align the board with the interests of shareholders.

IBM has come up with a smart approach. And given its status in corporate America, expect many other companies to follow suit.

Tom Taulli is the author of various books, including The Complete M&A Handbook and operates DealProfiles.com.

If an employee has lost money on his Google Inc. (NASDAQ:GOOG) options, who cares. Google does. The company has set up a program [subscription required, alternate] with Morgan Stanley (NYSE:MS) to allow Google staff to auction off their vested options, whether they are in the money or not. This means that if options are currently below the strike price, a financial institution might want to buy them anyway for the right to purchase Google shares in the future if the price comes down.

The program has been set up primarily for new employees and those being recruited. With Google's price below $500 and not moving up now, the company may be able to recruit and keep staff if employees know that there is a chance to get something for their options. Long-time employees with options that are at $100, $200, $300, or even $400 need not worry.

The program is a bit of a slap at Google shareholders though -- if they bought and lost money, it is tough luck. The program would also appear to have two negative consequences. One is that it does not encourage every Google employee to do his best to get the stock price up as the employee may be able to make money even if the shares stay flat (if the auction system works). The other, a more sinister consequence, is that this encourages financial institutions to hold options that they buy under the strike price. That means they gamble that Google's stock may come down.

Maybe the institutions can short Google as well and win both ways.

Douglas A, McIntyre is a partner at 24/7 Wall St.

Well, so Home Depot (NYSE: HD) comes clean regarding their options dating issues. They'll probably skate on the whole mess, many corporations do. That makes me just a bit upset. It should upset you too. For my fellow stock market novices, I can explain it like this: some backdating is nearly harmless, a matter of someone forgetting to sign a paper when it was due. Most backdating is really quite serious, involving the manipulation of the dates of financially critical variables which then directly affects values and payouts.

It could be similar to shifting receipts by a store owner to avoid a tax load. The store could date December sales receipts forward into January to reduce the amount of tax due for the current year. In this case it's forward dating but the principle is the same, change a date to adjust an effect. Adam Lashinsky, over at Fortune Magazine outlined the two backdating principles for me:

Backdate or Look Back options: These are stock options which are given out as compensation on a specific date and then dated backward to a time when those options were at a lower value, thereby creating instant increased value at a previously lower cost.

Forward-dating or spring loading options: This involves purposely waiting until a stock value drops or until bad news is released to distribute shares to the recipients thereby handing over the options in a deflated state. The value then generally rises "organically" with the expected value rebound. This scenario may actually fall under the heading of smart business, but it's manipulative just the same.

The SEC has their work cut out for them with these options dating issues. Regulations are scant and they're tough to apply. How do you account for the options issuers state of mind and intent? It needs to be shown that there was an expected outcome and that the manipulations were intended to mislead. For me it all comes down to one thing and that one thing is integrity. Liar is as liar does. Anyone who falsely dates financial documents is a liar and if they had worked for me they'd be looking for a new job.