LMP Real Estate Income Fund Inc. (NYSE:RIT) is a non-diversified, closed-end management investment company that invests in securities related to the real estate industry. The company has recently come under fire from investors concerned with the share price's discount to the company's net asset value (NAV). Spearheading the shareholder revolt is Stevenson Capital Management, who first expressed concern back in May 2006. The 9.6% holder renewed its threats in a Schedule 13D/A filing today, where it said that if the company did not take immediate action to correct the discount they would seek to replace members of the Board of Directors with a proxy fight.

What steps does Stevenson want the company to take to unlock this value? Well, the fund outlined three key solutions in their filing:

1. Within the next sixty days, the company urged the fund to sell sufficient assets to eliminate the company's leverage, which, in turn, will generate realizable net capital gains of approximately $5.00 per share to the shareholders.
2. Secondly, they demanded that the company commence a tender offer or a series of tender offers (or a reasonably structured open-market share repurchase program) to repurchase at least 400,000 shares of the company's common stock. Moreover, they noted that the transaction may need to be financed by selling assets, as mentioned above.
   
3. Finally, they demanded that the company commit to file with the SEC within a reasonable period of time, not to exceed 90 days, an application for an exemptive order that would allow the implementation of a managed distribution plan under Section 19(b) of the Investment Company Act of 1940 which will pay a dividend to the shareholders at an annual rate of 8% of NAV.

Stevenson then continued by outlining what would happen if the company did not comply with shareholder demands:

We realize that our approach presents a direct course of action. Our underlying proposition is that not enough of the value locked within the Fund is benefiting the shareholders. The value of the Fund belongs to the shareholders and we want management of the Fund to affirmatively take action to return a portion of that value to the shareholders. While your lack of response to our prior overtures have prevented us from having a meaningful dialog, I would again extend a sincere offer to you and your board to discuss the Fund’s future with us. If necessary, we are fully prepared to move forward to propose a slate of directors for election at the upcoming annual meeting of shareholders with individuals committed to realizing shareholder value and responding to shareholders concerns and to further propose for the consideration of the Fund’s shareholders that the Fund be converted from a closed-end to an open-end fund.

As the time to submit nominations and proposals under the Fund’s advance notice bylaws rapidly approaches, we hope that you realize that it would better serve the Fund and its shareholders if we could discuss our options rather than resort to a proxy fight. It is our hope that this letter serves as a catalyst to a meaningful dialogue.

Given the threat of a proxy fight at the upcoming annual meeting, it is likely that the company will at least respond to these demands. And clearly there is opportunity here if the company decides to positively respond to shareholder concerns. A return to NAV would mean significant share appreciation while a Section 19(b) distribution plan would unlock this value by distributing more to shareholders in the form of dividends. Combined, these factors make RIT a stock worth watching!

Synta Pharmaceuticals Corp. (NDAQ:SNTA) shares continued their decline today despite strong insider buying since its initial public offering earlier this month. Synta is an early-stage drug development company with a rich portfolio of chemical compounds, small molecules and plant extracts that it mines for drugs that the company hopes will be able to battle skin cancer or inflammation ailments like rheumatoid arthritis. Interestingly, the company's shares are down over 15% from their highs while several members of management and the Board of Directors have disclosed large purchases in a series of Form 4 filings with the SEC. Moreover, Luxor Capital Group also disclosed a 6% stake in the company in a Schedule 13G - indicating institutional interest in the company. Typically when a company IPOs, management uses the opportunity to divest their shares in order to diversify their portfolio. Therefore, this combination of events is certainly worth a second look...

Who is buying up these shares and could they have any information that normal investors do not? Well, there are several company officers that reported purchases, including:

• Eric Jacobson - Sr. VP, Research, and CMO - disclosed a 300 share purchase at $10/share on February 9th.
• Martin Williams - Sr. VP, Business Dev., and CBO - disclosed a 200 share purchase at $10/share on February 9th.
• Keith Gollust - Director - disclosed a 180,000 share purchase at $10/share on February 9th.
• Robert Wilson - Director - disclosed a 100,000 share purchase at $10/share on February 9th.
• Bruce Kovner - Director - disclosed a 720,000 share purchase at $10/share on February 9th.

Now, these numbers are not employee stock options, restricted stock grants, or stock awards - these are open market purchases of common stock using their own cash! One of the more interesting members of this group is Bruce Kovner, who readers of this blog may recognize as the manager of Caxton Associates - one of the more successful hedge funds on Wall Street. Currently, he alone holds around a million shares that he purchased for close to $10 million. Combined, this open market purchasing by company officers, directors, and a successful hedge fund manager make this stock one definitely worth watching!

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Shuffle Master, Inc. (NDAQ:SHFL) shares dropped more than 15% on yesterday after the company said it expects fiscal first quarter earnings to fall "significantly" below last years results due to lower revenues and higher costs associated with their February 1st Stargames acquisition. Other factors contributing to the windfall included the short-term impact from ending its Asia representative deal with Elixir Group Ltd. on February 4th, a $1.7 million revenue deferral related to a shipment to a Macau customer, and slower-than-expected rollout of multiplayer electronic table games.

Why are we concerned with a company that is under performing? Well, according to the company: "As a result of the near-term uncertainty associated with the factors discussed above, including, but not limited to, operational improvements in the company’s multi-player electronic table game business, including the evaluation of broader distribution relationships and the evaluation of various strategic alternatives for certain business segments, management has decided to temporarily suspend guidance for fiscal 2007." Shuffle Master CEO Mark Yoseloff said that the company would be evaluating all of their business segments in an effort to maximize long-term revenue growth, improve gross margins, and reduce operating costs. Restructurings can often provide opportunities to investors - particularly if they end up spinning off one of these segments. With shares near their 52-week low on what could be "short-term" windfalls, this is certainly a stock to keep an eye on!

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Ryerson Inc. (NYSE:RYI) shares dropped $1.99, or 5.71%, to $32.89 today after Owl Creek disclosed a 5.3% stake and expressed their dissatisfaction with the company's  management in a Schedule 13D filing with the SEC. The activist hedge fund said that they have reviewed Harbinger Capital's recommendations made on January 2, 2007 and concluded that they are not confident in current management's ability to improve the operating results of the company given the company's history of underperformance. Consequently, they said they would support Harbinger's slate of seven independent directors, whom they believe would add more specific industry experience and be more proactive managers of the company.

Why is change needed? Well, under the leadership of the current management team and Board of Directors, the company has underperformed its peer group in several key operating metrics such as inventory turns, margins, return-on-invested-capital, and share price returns. Indeed, the majority of the stock's rise over the past year was a result of Harbinger's proposal to replace the Board of Directors. Owl Creek is concerned that the current management team and Board of Directors are not sufficiently proactive in managing the company in an industry with a constantly changing business and operating environment.

The hedge fund also noted that it was strange that the current management team specified a number of new initiatives only after Harbinger filed its Schedule 13D in January. Meanwhile, the hedge fund siad it does not see evidence of a credible plan to support management's goals of improving underperforming service centers, achieving an inventory turn rate of 5x by the end of 2007, and operating more efficiently. And indeed, if there are actionable ways for the company to achieve these goals, it begs to question why these actions have only been implemented in response to shareholder pressure and have not been implemented sooner since the management team has been in place since 1999.

Overall, with the additional support of Owl Creek, it is increasingly likely that Harbinger's proposals will gain traction. Whether or not the Board of Directors is actually replaced depends on many factors; however, we do know that there is now increased pressure on management to perform. This makes RYI a stock worth watching!

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Eagle Hospitality Properties Trust, Inc. (NYSE:EHP) shares moved up $0.01, or 0.1%, to $10.35 after Corporex disclosed a 17% stake and made an offer to acquire the company for between $10.75 and $11.25 per share. The Schedule 13D/A filing noted that a draft merger agreement with a definitive price per share within the range described above would be delivered to your counsel immediately following successful conclusion of confirmatory due diligence. We first mentioned EHP back in January when the company's Board of Directors decided to explore a possible sale of the company. Since then, the company's shares have risen 10% with the buyout premium bringing that to as high as 19.6%.

But will the company accept the offer? Well, the offer is contingent upon a five day due diligence period, during which Corporex has the ability to withdraw its offer without penalty. Despite this, the offer is more likely than not to go through, given Corporex's existing 17% stake in the company, existing Board support, and their long-term interest in the company. The buyout premium comes in a bit lower than many were expecting, with some investors looking for $11.50 or higher; however, if the offer is accepted, Corporex would give the company a thirty day "go-shop" period to find other possible suitors. Overall, while this buyout was not as high as expected, it did net shareholders 10% to 20% in a month's time - that's nothing to complain about!

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Chrysler Group (NYSE:DCX) will offer allnearly 50,000 hourly workers in the U.S. up to $100,000 to leave the company as part of a recovery plan announced earlier this month. The company, which lost $1.475 billion in 2006, said it expects losses to continue through 2007. Chrysler plans to shed 13,000 jobs, including 11,000 hourly positions and 2,000 salaried, as it tries to further shrink itself to match reduced demand for its products.

Oil prices finished slightly higher Tuesday, after a volatile day that saw prices fall by more than $1 per barrel and then rebound to a 2007 high. Light, sweet crude for April delivery added $0.07 to settle at $61.46 a barrel on the New York Mercantile Exchange.
Movie-rental company Blockbuster Inc. said Tuesday its fourth-quarter earnings fell 28%, largely due to costs to launch and promote its growing online rental business. Quarterly net income dropped to $10 million, or $0.05  per share, versus $18 million, or $0.09 per share, a year ago.

For TXU Corp. (NYSE:TXU), higher fourth-quarter profits were eclipsed Tuesday by political wrangling over the pending sale of the company in what would be the largest private buyout ever. Compared to that drama, TXU's fourth-quarter results contained few surprises for Wall Street. The company churned out a 33 percent increase in profits despite weak revenue caused by mild winter weather.  The Dallas-based electric utility said it earned $475 million, or $1.03 per share in the last quarter, up 33% from its profit of $356 million, or $0.74 per share, a year earlier.

Target (NYSE:TGT) reported higher quarterly profit, beating estimates on strong holiday season sales and growth in its credit card business, but the stock fell amid a broad market sell-off. The No. 2 U.S. discount retailer, behind Wal-Mart Stores, said profit increased to $1.119 billion, or $1.29 a share, in the fourth quarter that ended on Feb. 3, from $939 million, or $1.06 a share, in the same period a year earlier.

Consumer electronics retailer RadioShack (NYSE:RSH) reported higher quarterly profit after a restructuring drive improved inventory management and cut costs, sending its shares sharply higher. The company also forecast stronger-than-expected earnings for 2007 on improved profitability. Q4 earnings rose to $84.5 million, or $0.62 a share, from $51.2 million, or $0.38 a share, a year earlier.

Great Atlantic & Pacific Tea Company (NYSE:GAP) said it was in talks to acquire rival supermarket chain Pathmark Stores for about $653 million in cash and stock. A&P said no final agreement has been reached. A deal would mark the latest merger in the quickly consolidating grocery-store industry. Last week Whole Foods Market said it would buy Wild Oats Markets for $565 million.

General Motors (NYSE:GM) expects its February U.S. sales to be down 6% to 7%, mainly due to the automaker's decision to reduce sales to daily rental fleets. Ford Motor forecast an even bigger sales decline, also mostly due to slower fleet sales. GM spokesman John McDonald told Reuters the company expects retail sales to be flat for the month.

Threshold Pharmaceuticals (NDAQ:THLD) said its experimental drug for pancreatic cancer failed to meet the goal of improving overall survival in a late-stage clinical trial, slamming the company's shares. Threshold shares plummeted 76% , from $14 to $3.35. 

Shares of Apple (NDAQ:AAPL) fell after the company said it would have to delay until March the launch of it gadget for streaming video and other content from computers to TV’s.

The Food and Drug Administration informed Novartis AG (NVS) that it needs an additional clinical data before it can approve the company's diabetes drug Galvus, a move that analysts say could delay the drug's approval by up to a year.

TXU Corp. (TXU), the biggest power utility in Texas, said Monday that its board agreed to a deal to be taken private by an investor group led by Kohlberg Kravis Roberts (KKR), Texas Pacific Group and Goldman Sachs.

Marvell Technology Group Ltd. (MRVL) said late Monday that fourth-quarter revenue rose 27% from a year ago as it sold more chips used in data storage devices and consumer electronics. Shares moved up on the news.

Apple Inc. (AAPL) shares slipped Monday evening after the company said that it has pushed back the release of its Apple TV product. "Wrapping up Apple TV is taking a few weeks longer than we projected," according to Lynn Fox, an Apple spokeswoman. No reasons were cited why.

Brocade (BRCD) shares rose 6.2% to $9.23 after the company reported fiscal first-quarter earnings of $33.3 million, or 12 cents a share, up from $9.7 million or 4 cents a share a year ago.

Threshold Pharmaceuticals (THLD) shares dropped 60% to $1.40 after the biotech firm said that a Phase III clinical trial for its drug candidate glufosfamide failed to show the drug could extend lives in patients stricken with pancreatic cancer.

NetEase (NTES) shares rose 3.7% to $22.63. The company said that its fourth-quarter net profit grew 19% to $41 million, or 30 cents per ADR, from a year-earlier profit of $34.4 million or 25 cents a share. Revenue grew nearly 15% to $69.2 million. Excluding certain items, fourth-quarter profit was $44 million compared with $34.2 million a year earlier. Analysts expected earnings of 24 cents a share on revenue of $64.8 million.

Focus Media (FMCN) shares traded up 3.2% at $85.68 after the company's fourth-quarter net income more than tripled to $30.1 million, or 55 cents per ADR, from $9.43 million or 23 cents an ADS a year earlier. Total revenue increased to $68.3 million from $24.6 million. Analysts were looking for earnings of 62 cents a share on revenue of $68.6 million.

Xilinx Inc. (XLNX) shares rose 1.1% to $26.63 after the company boosted its quarterly dividend to 12 cents a share from 9 cents a share. It also approvated a share buyback plan of up to $1.5 billion, which is in addition to the $175 million remaining from its previous program. The company is funding this through a proposed $900 million convertible notes offering.

Dow Chemical Co. (DOW) management said that it would oppose any attempt by buyout firms to break up the chemical giant. Shares, however, closed 3.5% higher on rumors that the company could be valued as high as $60 per share in a buyout.

Infocus Corporation (NDAQ:INFS) shares rose $0.08, or 2.91%, to $2.83 today after Caxton Associates disclosed an 11.2% stake and said it had reached an agreement with the company in a Schedule 13D/A filing with the SEC. We've been following Caxton's battle with the company for a few months now, as they pressed for a sale or restructuring of the company. A few weeks ago Caxton said that it would actively seek representation on the company's Board of Directors via a proxy contest at the next annual shareholder's meeting. The company quickly responded to these threats and today agreed to let the activist hedge fund occupy two seats on the Board after signing a confidentiality agreement. This is good news for shareholders, who should benefit from Caxton's guidance of the company. The hedge fund outlined its plans in a previous Schedule 13D/A filing with the SEC:

The Reporting Persons believe that the intrinsic value of the Company, and the amount a strategic or financial buyer would pay to acquire the Company, is significantly greater than the current market value of the Common Stock.  The Reporting Persons believe that this gap in value has resulted from the implementation by the Company's Board of Directors (the "Board") of a flawed business plan that has been detrimental to shareholder value. The Reporting Persons accordingly believe that the following steps should be taken promptly in order to preserve and maximize shareholder value:

1. The Reporting Persons believe that the Company's poor performance is the result of mistakes made by management and the Board's failure to grasp the strategic realities of the environment in which the Company operates.  At this time, we believe that the Company's operating management is capable of effectively executing the Board's strategic vision should it be given adequate guidance and oversight.  We do not, however, believe that the Board, as currently constituted, is providing the necessary strategic thinking.  Therefore, we believe that, unless significant changes are made promptly, changes in the Board are in the best interests of all shareholders.

2. The Board should include individuals with strong ties to large shareholders, as well as industry, legal and/or financial markets expertise, which have a firm grasp of the realities of the markets in which the Company operates.  Unless significant changes are made, the Board should be restructured to consist of Mr. Ranson, at least two individuals drawn from among the Company's largest shareholders, and other independent directors with relevant industry backgrounds.

3. As part of the Company's announced exploration of strategic alternatives, the Board should develop an operating strategy that not only protects and enhances the hard asset value of the Company, but also will allow the Company to be cash flow positive under any foreseeable circumstances.  The Board should immediately work with management to develop a business plan that, among other things, permits revenue growth only at a reasonable cost, fixes or exits money-losing operations, and leverages the Company's valuable brand name franchise and considerable intellectual property assets.  This new business plan should be assessed against other available alternatives, including the possibilities of a sale or restructuring of the Company.

The Reporting Persons continue to examine all of their options with respect to the possibility of taking actions that they believe will enhance shareholder value, including the option of actively seeking to replace members of the Board.

Caxton has an excellent track record of unlocking shareholder value through strategic alternatives. With management's willingness to listen, INFS shares could see significant upside during the next few months as the company pursues a sale or restructuring. Unfortunately, with a confidentiality agreement in place, it is unlikely that we'll see any updates until a definitive plan is announced. Regardless, this is definitely a company worth watching!

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Ceridian Corporation (NYSE:CEN) announced last week that it had hired Greenhill & Co. to explore a "broad range" of strategic alternatives in a move that upset Bill Ackman, who had been pushing for a Comdata spin-off. Sources close to the situation now say that investment bankers are already reaching out to potential private equity and corporate buyers who may be interested in acquiring the entire company - not just Comdata. Bill Ackman's Pershing Square believes that shareholders could realize more benefit by unlocking the value of Comdata than selling the entire company outright. Moreover, he argues that if Comdata were spun-off before a sale of Ceridian, shareholders could benefit from a better price and greater value in the end.

The situation is a win-win for existing shareholders, however. A sale of the company would come at a significant premium to the current market price, with many investors looking for around $40/share (18%). Alternatively, Bill Ackman already filed preliminary proxy materials so if the company isn't sold we know a spin-off is likely in the cards. And with Ralph Whitworth's Relational Investors joining Ackman a few weeks ago, the odds of success are greatly enhanced. Either way, shareholders stand to gain from a sale of spin-off. Combined, these factors make CEN a stock worth watching!

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Temple-Inland Inc. (NYSE:TIN) shares moved up $7.98, or 14.52%, to $63.06 today after the company announced that it would take Carl Icahn's recommendations and spin-off or sell three of its divisions. We have been following TIN with great interest since January, when Carl Icahn first proposed a breakup of the company to unlock shareholder value. Since then, shares of the company have risen nearly 30%! Congratulations to all SECInvestor readers who took advantage of this opportunity - we still believe there is a lot of upside after this transaction is completed as the true value of the company's operating segments are individually realized.

According to the company's 8-K filing with the SEC, the company's Board of Directors has approved a transformation plan to unlock shareholder value through the separation of Temple-Inland into three focused, stand-alone, public companies and the sale of its strategic timberland. Upon completion of the transformation plan, Temple-Inland will be a low-cost, highly efficient manufacturing company focused on corrugated packaging and building products. The plan includes:

1. Retaining its manufacturing operations – corrugated packaging and building products,
2. Spinning off its financial services operation,
3. Spinning off its real estate operation, and
4. Selling its strategic timberland

The sales process for the company’s strategic timberland is expected to begin immediately, with the majority of proceeds being returned to shareholders. The proposed separations of Financial Services and Real Estate are intended to be tax-free distributions to shareholders. The final terms of these proposed separations and sale have not yet been determined and will be announced at a later date. Completion of the proposed separations is subject to approval of the final terms by Temple-Inland’s Board of Directors; favorable rulings from the Internal Revenue Service, and/or favorable opinions of tax counsel; and the filing and effectiveness of registration statements with the Securities and Exchange Commission with respect to the common stock of each of the spun-off entities, and other approvals. However, the transformation plan is anticipated to be completed by calendar year-end.

Temple-Inland is yet another example of Carl Icahn successfully unlocking value in his investments for the benefit of all shareholders. Clearly there was hidden value in this company that could be unlocked through a strategic separation of its operating segments. Now that the Board of Directors has agreed to unlock this value, shareholders should benefit from not only the 30% rise leading up to today's news, but also the unlocking of value through the Timberland sale and two spin-offs! This makes TIN a stock that is still worth keeping an eye on!

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Private equity firms Kohlberg Kravis Roberts & Co. and Texas Pacific Group plan to include TXU Corp. (NYSE:TXU) Chief Executive C. John Wilder in their TXU buyout offer, which could total as much as $44 billion, according to a media report on Saturday.

Billionaire real-estate entrepreneur Sam Zell is proposing to participate in a buyout of troubled newspaper publisher and television broadcaster Tribune Co. (NYSE:TRB), according to a media report on Saturday.

Caremark Rx Inc. (NYSE:CMX) said Saturday it has mailed supplemental disclosures regarding its planned merger with CVS Corp. following a judge's ruling yesterday, and has scheduled a shareholder vote on the deal for March 16.

Dell Inc. (NDAQ:DELL) Chief Executive Michael Dell will be back in the company's earnings fray on March 1, when the newly returned chief executive delivers what is expected to be a negative fourth-quarter report in which sales and revenue are forecast to fall from a year ago.

Sources say DaimlerChrysler (NYSE:DCX) Chief Executive Dieter Zetsche, right, with CFO Bodo Uebber, hopes to offer a progress report on Chrysler at the German automaker's annual meeting on April 4 in Stuttgart.

Shares in Lowe's surged on Friday after the home improvement retailer said sales had "bottomed" following the downturn in the US housing market and predicted gradual improvement throughout 2007.

KB Home (NYSE:KBH), the fifth-largest US homebuilder, is under criminal investigation by federal prosecutors over stock-options backdating that led to the resignation of the company's chief executive.

Wendy's International Inc. (NYSE:WEN)said Friday that it will reluctantly close the restaurant where the nation's third-largest hamburger chain began in 1969 because of sagging sales.

Sirius Satellite Radio Inc. (NDAQ:SIRI) and XM Satellite Radio Holdings Inc. (NDAQ:XMSR) may forecast slowing subscriber growth when they report earnings next week, a slump that could help build support for their plans to merge with one another.

Sony (NYSE:SNE) Chief Executive Howard Stringer said it wouldn't make sense to break up the company's businesses in a digital age. "I'm certainly not thinking about it," said Stringer in an interview on CNBC's "Power Lunch." "I am finally achieving what I've been trying to get for the last decade."

News video showing about a dozen rats running around a KFC-Taco Bell restaurant in Greenwich Village was widely disseminated Friday on TV stations and the Internet. Yum Brands (NYSE:YUM) owns both franchises.

Troubles buffeting the U.S. mortgage market could get worse as resurgent crude oil prices squeeze the finances of already hard-pressed borrowers, analysts say, and that could spell more trouble for Wall Street. This would represent further fallout from the subprime mortgage correction that we've been seeing over the past few months.

Univision (NYSE:UVN), the nation's largest Spanish-language broadcaster, has agreed to a record $24 million fine for failing to meet government rules for educational children's programming, a Federal Communications Commission official said Saturday.

In a blunt Feb. 14 memo, Starbucks (NYSE:SBUX) CEO Mr. Schultz warned executives that the chain may be commoditizing its brand and making itself more vulnerable to competition from other coffee shops and fast-food chains. The nearly 800-word memo questioned whether Starbucks' automatic espresso machines, new store designs and elimination of some in-store coffee grinding may have compromised the "romance and theatre" of a visit.

Xinhua Finance Media Ltd. filed for an initial public offering on the NASDAQ market today under the symbol XFML. The financial news gathering service expects to raise about $300 million by issuing 23.1 million American depository receipts (ADRs) priced at between $12 and $14 each. Underwriters in the deal include J.P. Morgan, UBS Investment Bank, and CBIC World Markets among others. The company reported a 2006 net income of $3.3 million on revenues topping $59 million. After the IPO, Xinhua is expected to carry a market capitalization of about $1.8 billion, based on a $13 IPO price. The company said it will use $50 million of its IPO proceeds to repay debt, and the rest for acquisitions, working capital and other general corporate purposes.

What does the company do? Well according to their IPO prospectus (F-1 filing for foreign companies), the company engages in the creation and production of high-quality content that is distributed across nationwide television and print media outlets and radio in Beijing and Shanghai, and where advertising sales are supported by their own advertising agency. These outlets reach an estimated 210 million potential television viewers, a potential listening audience of 33 million people, and the readers of leading magazines and newspapers. In addition, the company's market research business enables our advertisers to analyze, understand and better reach their targeted consumers. Meanwhile, Xinhua's actual content currently focuses on business and financial news as well as wealth management and affluent lifestyle programming. They focus on this programming because we believe it attracts the highest income audience in China - an audience that is highly sought after by their target advertisers.

This is a great IPO to keep an eye on as past Chinese IPOs have done exceptionally well recently. The strong growth in these markets combined with increased exposure to foreign capital markets and investors have led to substantial gains for shareholders investing in Chinese companies.

PVF Capital Corporation (NDAQ:PVFC) shares moved up $0.56, or 4.98%, to $11.81 today after Ancora Capital and The Fedeli Group expressed concern over the company's recent operating results in Schedule 13D and Schedule 13D/A filings with the SEC. The activist hedge funds believe that while the company has a loyal customer base, established branch network, dedicated group of employees, and tremendous potential, several recent trends have created reason for concern. These trends include the drop in the company's return on equity and return on assets, the decline in the company's efficiency ratio, and the increase in general administration expenses - all key measures of a banks performance. Moreover, the hedge funds expressed concern over the aggregate level of loan loss reserves (which have decreased lately) and the overall weakness of the traditional real estate, commercial, and home mortgages markets. Combined, these factors have substantially lowered profitability and increased business risk.

Fedeli had made several attempts to meet with management to discuss ways to expand the business, reduce risk, and increase profitability; however, the company has failed to act on any of these recommendations. Consequently, The Fedeli Group has officially requested to examine a list of the company's shareholders so that they can reach other shareholders who may be interested in enforcing change. This is commonly the first step in a proxy solicitation aimed at replacing members of the board and taking over the company. Combined, these two hedge funds control approximately 13% of the company's outstanding shares, which gives them significant power in any such move. Whether or not a change in control will take place remains uncertain; however, this is definitely a stock to watch over the next few months!

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Acorda Therapeutics, Inc. (NDAQ:ACOR) shares moved up $0.26, or 1.15%, to $22.87 today after Daniel Loeb's Third Point disclosed a 9.9% stake in the company and urged the board to consider putting the company up for sale in a Schedule 13D filing with the SEC. The activist hedge fund said that it strongly believes that Fampridine-SR would have the greatest value in the hands of a seasoned worldwide multiple sclerosis drug developer and marketer. Afterall, a more experienced company would be able to expedite Fampridine SR through the FDA and into the hands of patients more quickly and efficiently and quickly create value for shareholders.

Consequently, Third Point recommended that the Board of Directors immediately retain an investment bank and undergo a process to sell the company in its entirety, and forego the recently announced plan to partner Fampridine SR only in Europe. They believe that by marketing Fampridine SR alone in the USA would not only be a tremendous injustice not only to multiple sclerosis patients, who should receive such an effective drug in the most expeditious manner possible, but also to your public shareholders, who have supported Fampridine SR's development. Moreover, a European partnership would be a serious mistake, as it would drastically impair if not eliminate the level of interest from potential acquirers of ACOR. Based on their analysis, Third Point believes that there would be several potential interested buyers and that the acquisition price would be significantly in excess of the current market valuation.

Daniel Loeb is a seasoned activist investor who has successfully forced similar changes in other companies - a future sale of the company is definitely a possibility with nearly 10% of the company's outstanding shares in his hands. Acorda now has to decide whether they want to voluntarily comply with Third Point or attempt to fight the proposal, which could lead to an expensive proxy battle (which they hinted to at the end of their letter to the board). If Third Point is successful in forcing a sale of the company, it could mean significant share appreciation for investors. This makes ACOR a stock that is definitely worth keeping an eye on!

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XenoPort, Inc. (XNPT)

SalesForce.com, Inc. (NDAQ:CRM) shares moved down $1.21, or 2.52% to $46.79 in choppy midday trading as investors attempt to digest the company's earnings announcement after the close yesterday. The company announced impressive numbers, but failed to wow some analysts who have extremely high expectations for the quickly growing company. Some of the most important factors to consider for companies like this are customer adoption and revenue ramp. CRM was able to surpass expectations in both of these areas after announcing impressive fourth quarter numbers. "The fourth quarter was remarkable for its strength across all business segments, products, and geographies, best demonstrated by our adding 90,000 net new subscribers, and 2,700 net new customers," said Marc Benioff, Chairman and CEO of salesforce.com. "The fourth quarter also included our largest enterprise implementation, 25,000 subscribers—the largest on-demand CRM customer ever—demonstrating the enterprise-class scalability of our solution that is unrivaled in the industry today. In fact, we added more than a thousand net new subscribers a day during the quarter for a new grand total of approximately 646,000."

Many investors, however, were concerned with the company's guidance for next year. Specifically, they are concerned that there are no short term catalysts to drive revenue and subscriber growth in the near-term future. However, the company announced that it would be increasing its full year revenue outlook, expecting to take in approximately $720m - up from $710m reported in December. Meanwhile, some analysts have also expressed concern that the company may have to continue to increase their spending to remain competitive in the CRM marketplace, which may put a drag on profitability in the future. Regardless, this company is certainly one that is growing at a blistering pace, already up over 90% from its 2006 lows. This makes CRM a stock that is definitely worth watching!

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LESCO, Inc. (NDAQ:LSCO) shares edged up $0.08, or 0.56%, to $14.33 in early trading today after Hawkshaw Capital Management voiced its opposition to the Deere & Co. $14.50/share buyout offer in a Schedule 13D filing with the SEC. The hedge fund argued in an attached letter that while the current offer makes sense for Deere & Co., it fails to adequately compensate LESCO shareholders for a return to normal operating earnings (before their recent downturn) and the value creation from continued expansion of the company's profitable retail service center business. Hawkshaw also expressed concern that the company decided to sell at an inopportune time - that is, immediately following one of the worst years in the company's history. LESCO shares dropped around 50% in 2006 due to temporary, fixable issues. In fact, management has already articulated plans to rebuild their sales force, avoid the hedging losses seen in 2006, and build more capital service centers. Finally, Hawkshaw questioned whether or not the board had sufficiently executed its fudiciary duty to shareholders to maximize shareholder value. The current offer was accepted without any kind of open auction process in which other parties would have been given an opportunity to bid.

Hawkshaw currently holds a 13% stake in the company and said it would withhold its votes in opposition if the company failed to meet it demands. The hedge fund believes that other parties should be given the opportunity to place bids, and if none materialize, the company should remain independent. It will be interesting to see if other shareholders support this notion that the $14.50 bid is too low to justify, which could lead to an increased bid or termination of the merger agreement. While this is not all to likely at this point, LSCO is definitely a stock worth keeping on the radar!

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Luxury-Home Bulder Toll Brothers' (NYSE:TOL) Q1 profit is down 67%. Quarterly earnings declined to $54.3 million, or $0.33 per share, from $163.9 million, or $0.98 per share, during the same period a year ago. Revenue slipped 19% to $1.09 billion from $1.34 billion in the previous year, meeting Wall Street's expectations.

Microsoft Corp. (NDAQ:MSFT) must pay $1.52 billion in damages to telecommunications equipment maker Alcatel-Lucent SA for violating two patents related to digital music, a federal jury ruled. Shares of Microsoft slipped $0.03 to close at $29.32 on the Nasdaq Stock Market. Alcatel-Lucent's stock added $0.10 to end the day at $13.17 on the NYSE.  

Newmont Mining Corp. (NYSE:NEM) and Barrick Gold Corp. (NYSE:ABX),two of the world's largest gold miners, reported strong Q4 earnings due to higher selling prices. However, they predict that production will slow in the year ahead because of rising operating costs. Barrick Gold had Q4 earnings that more than doubled to $418 million, or $0.48 per share, from $175 million, or $0.32 per share, in the year-ago period. For the quarter ending Dec. 31, Newmont reported their net income of $223 million, or $0.49 per share, compared with $62 million, or $0.14 per share, in the prior-year quarter.

Safeway Inc.'s (NYSE:SWY) Q4 profit surged 77% to cap the grocer's best performance in five years, a comeback driven by contentious cost cutting and a recent makeover that has infused more elegance into its stores. The company earned $307.9 million, or $0.69 per share, in the three months ended Dec. 30. That compared with net income of $173.5 million, or$0.39 per share, at the same time in 2005.

J.C. Penney Co. (NYSE:JCP) said its Q4 profit fell 13%, partly due to higher taxes. The company predicts a weaker Q1 than Wall Street expects. Penney shares fell $2.96, or 3.4% to $83.39 in trading on the NYSE. In the fiscal year that just ended, Penney earned $1.15 billion, or $4.96 per share. That's up 6 percent from $1.09 billion, or $4.26 per share the year before. Revenue also grew 6%, to $19.90 billion from $18.78 billion.

Turbo Tax software maker Intuit (NDAQ:INTU) posted lower Q2 net income and cut its full-year forecast. The company also said unit sales through Feb. 17 of Turbo Tax, which generates about 25% of overall revenue, were up 1% from the previous year. The company's Q2 net income fell to $145 million, or $0.40 a share, from $183 million, or $0.50 per share, a year ago.

Analog Devices (NYSE:ADI) forecast that profit for its current quarter would be $0.37 to $0.42 a share on revenue of between $640 million to $670 million. Analysts had forecast Analog Devices would show a fiscal Q2 profit of $139.3 million, or $0.39 a share, on revenue of $655.1 million. Shares of Analog Devices leaped as investors responded to an optimistic outlook that the company announced along with earnings. The company said net profit in its first fiscal quarter ended Feb. 3 was $153.2 million, or $0.44 a share, compared with $120.6 million, or $0.32 a share, a year earlier. Revenue rose 11% to $691.6 million, well above estimates of $652 million.

Walt Disney (NYSE:DIS) plans to add two cruise ships to its existing lineup, in an effort to meet increasing demand and provide more trip destinations. Disney, which currently has two ships, said the new ocean liners will hit the waves in 2011 and 2012. Each ship will have 1,250 rooms.

Europe's biggest bank, HSBC Holdings (NYSE:HBC), has ousted the head of its North American operations, Bobby Mehta, in the wake of this month's shock profit warning from its troubled U.S. mortgage business. The bank also replaced the head of its New York-based retail banking operation, HSBC Bank USA. HSBC said Mehta stepped down as chief executive of HSBC Finance Corp. and as head of HSBC North America with effect from February 15. HSBC also appointed Paul Lawrence as president and CEO of HSBC Bank USA and HSBC USA Inc. with immediate effect, replacing Sandy Derickson, who is leaving the bank.

CSK Auto Corporation (NYSE:CAO) shares moved up $0.28, or 1.62%, to $17.54 today after Karsch Capital Management disclosed a 9.4% stake along with a letter in the company in a Schedule 13D/A filing with the SEC. The activist hedge fund said in a letter that it believes that the company's shares are undervalued at their current market level and believes that the company should actively pursue a sale once it has completed its pending restatement of certain of its past financial statements and becomes current with its SEC reporting obligations. Karsch had first insisted on hiring an investment banker back in October of last year and later attempted to add its own candidates to the company's upcoming proxy. However, CSK has since informed the SEC that it does not intend to voluntarily include Karsch Capital's stockholder proposal in its proxy materials for the next annual meeting of stockholders and has asked the SEC to confirm that it would take no action against the company if it does so.

Yesterday, the hedge fund sent another letter to the company asking when they would finish restating earnings to satisfy the SEC and asked that the company immediately put itself up for sale after the process was completed. According to their latest letter attached to their most recent Schedule 13D/A filing with the SEC:

Since our last letter to the Board dated October 23, 2006, we have received numerous inquiries about CSK Auto that lead us to believe that there is genuine interest from private equity firms in acquiring the Company and from investment banks in financing a transaction for a prospective buyer.  Now that the company has stated that it expects that it can file its financial statements no later than one month beyond the February 28, 2007 date set by the SEC, we have received numerous indications that potential acquirers would prefer to conduct their due diligence investigation of the Company now and thereby be in a position to make an acquisition proposal at or shortly after the date the Company files its financials.

Further, while we understand that the Board, for business reasons, may not wish to allow competitors and other potential strategic buyers access to sensitive business information, hiring a nationally-recognized investment bank to run an auction process appropriately mitigates such considerations and such considerations are not applicable to financial buyers.

The debt capital markets are very strong right now.  By putting the Company up for sale immediately, we believe the Board would increase the probability of a
transaction given these current robust capital markets.  We strongly feel that this would be the best course of action to maximize shareholder value.

Given the continued strength of the M&A market - particularly by private equity - along with the substantial discount that this company is trading at due to their restatements, a sale of CAO could come at a substantial premium to the current market price. If Karsch is not successful in convincing management to take this step on their own, they may be forced to attempt to take control via a proxy fight. While this process is somewhat uncertain and time consuming, CAO is definitely a stock that is worth watching over the next few months!

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JetBlue Airways Corporation (NDAQ:JBLU) shares moved up $0.43, or 3.33%, to $13.33 today after falling sharply at Tuesday's open. The company remains positive that it will be able to rebound from weather-related troubles that it had earlier this week that caused around 1,000 flights to be delayed. Founder and CEO Dave Neeleman has already estimated the damage at more than $30m in lost revenue and free flights, and unveiled a "passenger bill of rights" plan in an effort to lessen the brand damage. The $30m charge will affect the quarterly earnings - swinging them to a loss - but will have little impact on the full-year earnings forecast. Moreover, Neeleman said that the new compensation scheme – which promises a sliding scale of refunds and free flights depending on the severity of delays – would act as a marketing tool and "pay for itself". The way JetBlue handled this situation and got itself back on track today says a lot about their management ability. Moreover, the impressive growth that the company has experienced along with the recent upgrade make JBLU a stock that is definitely worth watching.

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Natural Health Trends Corp. (NDAQ:BHIP) shares moved down another 5% today after several shareholders expressed their dissatisfaction with the company's current management. The ~4% shareholders filed a Schedule 13D/A with the SEC, and outlined their complaints in the Purpose of Transaction section:

The Reporting Persons no longer have trust or confidence in the Issuer's President, Chief Executive Officer and board member, Ms. Stephanie Hayano, and intend to work towards securing her dismissal or resignation from those positions at the earliest possible moment. The Reporting Persons believe that the Issuer's current difficulties can be attributed, for the most part, to Ms. Hayano's lack of industry experience. The Reporting Persons are of the view that Ms. Hayano does not understand the Japanese and Mexican markets in which the Issuer does business and, therefore, is unable timely to resolve direct selling issues in those markets. These two factors, the Reporting Persons believe, have significantly contributed to the declining revenues in the Japanese and Mexican markets. The Reporting Persons are also of the opinion that Ms. Hayano's failure to provide adequate leadership and management during this critical juncture may lead to a substantial decrease in the number of the Issuer's active distributors. Finally, the Reporting Persons are concerned that Ms. Hayano intends to either pull money out of the Issuer's Chinese subsidiary, which may cause a deficiency in that entity's capitalization and ultimately force it to de-register in China, or sell the Issuer's Greater China business at a fraction of its value. Either move may, in the view of the Reporting Persons, destabilize the Issuer's entire global seamless network of independent distributors. The Reporting Persons fear that, because Ms. Hayano lacks industry experience, she does not understand the possible implications of either action.

Clearly the company is facing problems as it continues to move down and most of these problems can be traced back to the company's Chief Executive Officer. With a stock that is down roughly 80% since 2006 - after the company was subjected to a formal SEC investigation as well as related class action lawsuits - there may be support for their proposal to remove members of management. This makes BHIP a stock worth watching over the next few months.

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Wilshire Enterprises (AMEX:WOC) shares remained even in early trading today after Bulldog Investors disclosed a 14.87% stake in the company and announced their intent to nominate two of their own candidates to the company's board of directors. The activist hedge fund also said that it plans to propose that WOC's investment banker immediately conduct an auction to sell the company to the highest bidder. Bulldog believes that the company's shares are undervalued and hopes to unlock shareholder value through a sale process. The only major obstacle is a poison pill that the company has in place to prevent a takeover; however, Bulldog is likely hoping to get this removed by shareholder vote. Given their nearly 15% stake in the company, this might be possible.

The other major obstacle may be finding a buyer for the company. Wilshire owns and invests in multi-family, office rentals, and retail space real estate properties in Arizona, Texas, Florida, Georgia and New Jersey. The company also maintains investments in marketable securities, which are classified as available for sale. Given the strength of the commercial real estate market recently, this company could be in a good position to sell itself to unlock value. Whether or not this actually happens depends on whether or not the hedge fund can remove the company's poison pill and whether or not the investment bank is successful in locating a buyer. Either way, this is definitely a stock that is worth keeping an eye on!

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Oil prices settled above $60 a barrel for the first time this year after a pipeline and oil field shut down and threatened to cut into supply. Increasing tensions over Iran's uranium enrichment program also helped to boost prices.

JetBlue Airways Corp. (NYSE:JBLU) said it expects a wider Q1 loss and lower full-year profit, as it absorbs the effect of more than 1,000 cancellations caused by last week's winter blast in the Northeast. JetBlue expects to report a full-year profit of $0.44 a share, down from a prior projection of $0.64. Analysts overall are looking for $0.52 a share. Despite the lower guidance, JetBlue shares rose $0.29, or 2.3$, to close at $13.19 on the Nasdaq Stock Market, after earlier climbing as high as $13.56. The stock has traded between $8.93 and $17.02 over the past year.

Medco Health Solutions Inc. (NYSE:MHS), the biggest U.S. prescription-benefit manager, said its Q4 earnings soared 29% on higher overall revenue and improved results in its key specialty pharmacy business. The results beat Wall Street expectations, the company raised its profit forecast, its board authorized a bigger share buyback and shares set a new 52-week high. They rose $6.21, or just over 10%, to close at $67.80 on the NYSE.

General Motors (NYSE:GM) gave AT&T (NYSE:T) an award of a five-year, $1 billion global networking contract that will prepare the world's largest automaker for whatever electronic breakthroughs lie ahead. AT&T shares fell $0.15, or 0.4%, to close at $37.21 on the NYSE. GM shares fell $0.58, or 1.6%, to close at $35.37 on the NYSE.

Abercrombie & Fitch (NYSE:ANF) said that its Q4 earnings jumped 20%, powered by strong sales as the teen retailer continues to expand its Hollister line of stores. Analysts expect earnings of $2.14 a share on revenue of $1.1 billion. Abercrombie shares ended the day at $82, down $0.64. Shares fell $2.30 to $79.70 in trading after hours. Abercrombie shares have been trading near their record high of $83.82. The shares have been as low as $49.98 in the past year.

Analog Devices (NYSE:ADI) posted a higher quarterly profit as the maker of analog and digital signal processors benefited from strong sales of consumer products like flat-screen televisions and video game controllers. The company's profit jumped 27%, along with shares of Analog Devices that jumped more than 5% in after-hours trading. Analog Devices also forecast that profit for its current quarter would be $0.37 to $0.42 a share on revenue of between $640 million to $670 million.

Best Buy (NYSE:BBY) plans to open about 130 stores in the United States, Canada and China during its fiscal year beginning March 4. The top U.S. consumer electronics retail chain said it expects global retail square footage of about 46 million square feet, representing growth of around 10%, by the end of the year. In the United States, the company expects to open about 90 stores and to operate more than 900 by the end of the year.

Temple-Inland, Inc. (NYSE:TIN) shares moved up $1.71, or 3.32%, to $53.16 today after Carl Icahn announced plans to nominate his own slate of directors at the company's next annual meeting. We first began covering this story back in January, when the activist shareholder stated that shareholders could benefit from a spin-off or divesture of some of the company's business units. According to Icahn's past Schedule 13D filing with the SEC:

"The Reporting Persons acquired their positions in the Shares in the belief that they were u