The Motley Fool columnist compares investing in the shares of First Solar (FSLR: sentiment, chart, options) to patronizing a popular cheesesteak joint in Philly: the risks may be high, but so are the rewards.

Despite declining polysilicon prices and concerns about growth sustainability, the author claims FSLR is "still a risk worth taking," citing a low PEG ratio and a promising first-quarter earnings report. In addition, the Fool notes the potential benefits from the Obama administration's vow to spend $150 billion on renewable energy in the next 10 years, as well as the prospects for solar growth in Germany and escalating demand for semiconductors in China and India. Plus, compared to its peers, First Solar boasts the lowest solar manufacturing costs in the industry, the article states.

The author concludes by deeming First Solar "the best and brightest of the solar bunch," calling it a great opportunity for long-term investors who "have time to buy and hold, and won't get finicky about commodity prices or the next market bottom."

If FSLR is "the best and brightest" of the solar sector, it's a virtual falling star compared to the broad market of late. During the past 40 trading sessions, the stock has underperformed the S&P 500 Index (SPX) by about 23%, breaching intermediate-term support from its 50-week moving average in the process. In fact, since grazing the $205 level in mid-May, the shares have surrendered roughly 24% to hang out in the $156 region, at last check.

Nevertheless, the Street – like the aforementioned Fool - has high expectations for FSLR. The stock's Schaeffer's put/call open interest ratio (SOIR) of 1.01 stands in the 33rd annual percentile, indicating that near-term option traders have been more bullishly biased toward the security only a third of the time during the past year. On that same note, during the past couple of weeks, speculators on the International Securities Exchange (ISE) have bought to open more calls than puts on FSLR, for a 10-day call/put volume ratio of 1.22, in the 74th annual percentile. Simply put, during the past 52 weeks, traders on the ISE have rarely scooped up FSLR calls at a faster pace.

Meanwhile, Thomson Reuters pegs the average 12-month price target on the equity at a lofty $185.55, nearly 30 points above FSLR's current trading range. Plus, according to Zacks, the solar sultan harbors 11 "strong buys" and two "buy" ratings, compared to eight lukewarm "holds" and only three "sell" or worse ratings.

Should the shares of FSLR continue their downward trajectory, the bulls could abandon ship. An unwinding of optimism among option traders, or a round of price-target decreases and/or downgrades, could pressure the stock even further into the red. In fact, just this morning JPMorgan trimmed its rating on the equity to "neutral," and predicted that many solar stocks – including First Solar – likely won't be able to weather a second downturn if the market takes another dip.

The article expresses concern about the J.C. Penney Co. Inc.'s (JCP: sentiment, chart, options) ability to bounce back from the loss of President and Chief Merchandising Officer Ken Hicks, who announced last Thursday that he is leaving the department store operator to become president and CEO of athletic shoe retailer Foot Locker Inc. (FL). The article also opines that the shares of JCP aren't particularly cheap at the moment, as the stock trades at a forward looking price-to-earnings (P/E) ratio of 24, not far shy of its five-year P/E high of 27.

Furthermore, department store sales remain down across the board. Even if consumer spending bounces back, Howard Davidowitz, chairman of Davidowitz & Associates Inc., a national retailing consulting firm, doesn't expect consumers to be spending money at J.C. Penney. He believes, "The real winners are the dollar stores and Wal-Mart (WMT) for general merchandise and TJ Maxx and Ross for apparel." In fact, the article closes by warning investors to "avoid the stock."

Technically speaking, the shares of JCP have been on a tear. The equity rallied from its March low of $13.71 to its May high, gaining approximately 140%. The stock is now consolidating its gains as it bounces along support in the 25-26 area. The security has recently rebounded off this region and is making another run at short-term resistance in the 30-32 region.

From a sentiment perspective, traders are skeptical of the shares. During the past month, the number of JCP shares sold short increased by 3.6% to 21 million. This accumulation of bearish bets accounts for 8.9% of the company's total float. An unwinding of these pessimistic positions could fuel a solid rally in the shares.

Furthermore, Wall Street has its doubts about the firm, as six of the nine analysts following JCP rate it a "hold" or worse. This bearish configuration leaves ample room for upgrades, which could boost the shares higher during the near term.

Overall, traders should keep a close watch on resistance in the 30-32 region, as a break above this area could shake loose the bears, creating a fresh wave of buying pressure for the security.

According to this BusinessWeek article, Avon Products Inc. (AVP: sentiment, chart, options) is benefiting from the global recession in at least one respect: "It has been able to do more hiring, even as world unemployment rages." In fact, the beauty products specialist saw a 47% surge in new U.S. sales representatives, with the jump being seen in other parts of the world as well. Specifically, Avon has hired some one million sales reps in China since 2005.

Employing more reps is a key part of Avon's long-term growth strategy, Alpine Dynamic Dividend Fund portfolio manager Kevin Shacknofsky told BusinessWeek. "We've been buying shares of undervalued companies such as Avon," said Shacknofsky, "They are taking advantage of the recession while, at the same time, paying decent dividends."

Analysts are also playing up AVP's edge in the global downturn. "Revenue and operating profit trends are likely to improve for the rest of 2009 and in 2010," says Mark Astrachan of investment firm Stifel Nicolaus. Astrachan rates AVP a "buy," noting that the company will reinvest recent saving into advertising and the hiring of more reps.

From a technical perspective, AVP has been no slouch this year, gaining more than 9% since January. Furthermore, the shares have soared some 43% since the market bottom in mid-March. The shares have even bested the S&P 500 Index (SPX) by nearly 13% on a relative-strength basis during the past 60 trading days. Throughout this rally, AVP has enjoyed the support of its 10-day and 20-day moving averages, while the stock's most recent pullback was cut short by its rising 32-day trendline.

On the sentiment front, options players are still warming to AVP shares. The stock's Schaeffer's put/call open interest ratio (SOIR) has been in decline mode since June 16, dropping from a reading of 1.45 to its current perch at 1.32. Furthermore, call buying has neared parity with put buying on the International Securities Exchange (ISE) and Chicago Board Options Exchange (CBOE), with the stock's 10-day call/put volume ratio arriving at 0.95.

Meanwhile, Wall Street is heavily bullish toward AVP. Currently, six of the eight analysts following the shares rate them a "buy" or better, with no "sells" to be found, according to Zacks. Additionally, Thomson Reuters reports that the average 12-month price target for AVP rests at $28 per share - a premium to Friday's close at $26.21 per share.

However, pessimism is growing among short sellers. In fact, the number of AVP shares sold short has jumped from 9.78 million in early May to 13.89 million currently. Still, only 3.3% of the stock's float is sold short, meaning that the short play is far from overcrowded. Should traders continue to sell AVP short, it could be a concern for bullish investors.

This upbeat article argues that VistaPrint (VPRT: sentiment, chart, options) might be worthy of a "second look" from investors. The author points to 21% revenue growth during the quarter ended in March, and adds that VPRT's strong Internet presence might make it the Netflix (NFLX) or Amazon.com (AMZN) of the printing industry.

Additionally, the company's large-scale production process provides VPRT an advantage over its competitors. Because more than 100 orders can be printed using the same plate, the firm is able to offer a 15% to 20% discount to its peers. These bullish catalysts, says the author, might be justification enough for traders to overlook VPRT's relatively rich price/earnings ratio (37.56, as of this writing).

The shares have already rallied a whopping 131.5% in 2009, but it looks as though VPRT has the technical muscle to keep climbing higher. The stock is currently enjoying the support of multiple trendlines, including its 10-day, 20-day, and 10-week moving averages. Additionally, the security has now managed three consecutive monthly closes atop former resistance from its 10-month and 20-month trendlines.

Despite this outperformance, pessimism is practically palpable on Wall Street. The stock's Schaeffer's put/call open interest ratio (SOIR) checks in at 1.93, with puts nearly doubling calls among short-term options. This ratio is just seven percentage points from an annual bearish peak.

Plus, a hefty 28.9% of VPRT's float is dedicated to short interest. This major accumulation of shorted shares would take 8.5 days to fully repurchase at the stock's average daily trading volume. As the security continues its intermediate-term uptrend, an unwinding of pessimism among option traders and short sellers should translate to fresh selling pressure for this high-flying issue.

The aftermath of Research In Motion Limited's (RIMM: sentiment, chart, options) latest trip into the earnings confessional wasn't pretty, with the shares gravitating lower in the sessions following the report. Late last week, the smartphone maker issued a moderate forecast for its fiscal second quarter - which the Wall Street Journal says reveals "just how uncertain the future is" for the company.

More specifically, the article says RIMM should be worried about the future of its BlackBerry smartphone. During the last quarter, net new BlackBerry accounts declined from the fourth quarter. Plus, consumers – not businesses – accounted for 80% of those additions, up from 70% in the previous quarter. "That is a mixed blessing," the WSJ column notes, stating that "corporate users appreciate BlackBerry for the efficiency and security of its email, [while] consumers are more responsive to the latest fashion and to price." Most notably, the author cites new smartphones from Apple Inc. (AAPL) and Palm Inc. (PALM), which he says will likely erode RIMM's U.S. smartphone market share.

RIMM not only has to contend with escalating competition in the smartphone arena, but also must face the pressure of meeting the Street's lofty expectations. According to Zacks, 22 of the 34 ranking analysts currently deem the stock worthy of a "buy" or better rating. On that same note, Thomson Reuters pegs the average 12-month price target on the equity at $98.72, representing a 41% premium to the stock's current price around $70.

Meanwhile, the security's Schaeffer's put/call open interest ratio rests at 0.68, implying that calls outnumber their bearish rivals among options slated to expire in three months. What's more, compared to similar readings taken during the past year, the stock's SOIR sits in the 40th annual percentile. In other words, short-term speculators have been more optimistically aligned toward RIMM only 40% of the time during the past 52 weeks.

Technically speaking, the equity took a hit on the charts following its latest earnings report. In fact, RIMM has underperformed the broader S&P 500 Index (SPX) by 11% during the past 20 trading sessions. Furthermore, the stock is now poised to close its second straight week beneath its 10-week moving average for the first time in about three months.

Should the shares of RIMM fail to reclaim this formerly supportive trendline, the bulls could get spooked. A fresh wave of downgrades and/or price-target cuts, or an unwinding of optimism in the options pits, could exacerbate the recent selling pressure on the stock.

Aeropostale (ARO: sentiment, chart, options) is moving into the children's market and recently opened its first P.S. store, which will target the 7- to 12-year-old brothers and sisters of the core Aeropostale demographic. The company plans to open about nine additional stores, mostly in the New York metropolitan area, during the year. It will also roll out an e-commerce site, www.ps4u.com.

According to the article, CEO Julian Geiger stated, "We are taking all of the success of Aeropostale -- both operational and merchandising -- and making modifications to fit the younger demographic." He believes, "There is a void in the market for this demographic of fashionable clothes at value prices. We have the advantage of already having built-in recognition with moms and kids."

The article also contends there is more room for ARO to grow, as it is nowhere near saturation, with only 881 stores in the United States, Canada and Puerto Rico. In comparison, Abercrombie & Fitch has 1,112 stores, and American Eagle Outfitters operates 1,118 stores.

Wall Street remains optimistic. "With very few players expanding, the level of vacancies has continued to creep up at the mall," Eric Beder, analyst at Brean Murray, Carret wrote in a note. "We believe this has offered aggressive players the ability to acquire premium space in strong malls at fair pricing, which should result in stronger returns longer term."

Technically speaking, the shares of ARO have put in a stellar performance since the beginning of the year, gaining more than 112%. In fact, the security has been guided higher by its 10-week moving average since the beginning of January, providing a solid layer of support.

However, there are still signs of pessimism in the stock's sentiment backdrop. The Schaeffer's put/call open interest ratio rests at 1.42, as put open interest outnumbers call open interest among near-term options. This reading is also higher than two-thirds of the readings taken during the past year, pointing to high levels of skepticism.

Short sellers have also flocked to the security in an attempt to call a top to the stock's ascent. Nearly 10 million ARO shares have been sold short, accounting for more than 15% of the company's total float. An unwinding of these bearish bets could fuel a significant rally in the shares.

Considering the stock's stellar outperformance of the broad market and fundamental strength, the optimism on Wall Street is to be expected.

According to this Barron's article, Carol Bartz "has the skills needed to transform [Yahoo!] into a leaner, meaner revenue generator." Furthermore, the author claims that Yahoo! Inc. (YHOO: sentiment, chart, options) investors will win, even with a buyout. Aside from Bartz's pedigree of lifting companies such as Autodesk (ADKS) from the ashes, the article argues that YHOO shares are cheap, trading at the lowest earnings multiple among their peers. "The company's enterprise value (market value plus debt) is just 5.7 times its 2009 Ebitda (earnings before interest, taxes, depreciation and amortization), compared with Google at 10.9 times and Amazon (AMZN) at 20.6 times," states Barron's.

Analysts are beginning to come around to the bulls' camp, with Citicorp analyst Mark Mahaney upgrading Yahoo! to "buy" and setting a price target of $21 per share. Still, $21 per share is a far cry from the $31 per share that Microsoft Corp. (MSFT) offered for the firm just last year. But Bartz seems very unwilling to take the reins at YHOO just to repackage it for sale. In recent comments at the All Things Digital conference, Bartz quipped to activist shareholder Carl Icahn, who would prefer a YHOO sale, "You know, Carl, you hired me, so fire me."

But the CEO didn't rule out a sale, stating "You can't say that you are never going to sell." However, Bartz did note that Microsoft would need to offer "boatloads" of cash in order to acquire YHOO, Barron's reported.

It was speculated at the time of the Microsoft offer for YHOO that the software behemoth would allow its spurned offer to expire, only to pick up Yahoo! at a considerably discounted price in the aftermath. While some would argue that such a time is fast approaching, with Bartz apparently correcting many of the ills that plagued YHOO ahead of her arrival, MSFT can still bide its time following the initial success of its new Bing search engine. But can it afford to wait much longer, with analysts such as Citi's Mahaney predicting $21 per share for the Internet portal?

The answer, likely, is "yes." YHOO may have rallied impressively from its November low near $9 per share, but the stock has recently hit a snag in the 16-17 area. Technically speaking, this region marked the equity's lows in late September 2008, and could prove difficult for YHOO to overcome in the short term. Furthermore, the shares are in danger of breaching key support at their rising 10-week moving average. This trendline has ushered YHOO steadily higher since late February, and a breach of this moving average could signal a period of weakness for the shares.

Meanwhile, investor sentiment points toward potential weakness for the shares. In the options pits, traders have bought to open more than three times as many calls than puts on the International Securities Exchange (ISE) and Chicago Board Options Exchange (CBOE) during the prior two weeks. With short-term technical pressure building, these bulls could find themselves disillusioned with YHOO's lack of progress and abandon their positions. An unwinding of this optimism could result in selling pressure for YHOO shares.

Additional selling pressure could also emerge from the short-selling crowd. In fact, the number of YHOO shares sold short ballooned by more than 10% during the most recent reporting period. With only 4.5% of the stock's float sold short, this bearish trade is far from crowded. As such, there is plenty of room for more potential short selling that could provide additional downside pressure for YHOO.

This article notes that crude oil prices are beginning to recover from their precipitous plunge, and as a result, investors are starting to rediscover a few names within the oil sector. Apache Corporation (APA: sentiment, chart, options) is cited as one name within the group that's worth taking a look at, thanks to "its large stake in the U.S. and its high success rate in oil drilling of about 93%," according to Joseph Tatusko, chief investment officer at Westport Resources Management.

The author observes that APA is currently trading at a discount to its larger-cap peers, even though the equity has already regained a significant amount of ground from its 52-week low of $51.03, tagged as recently as mid-March.

In addition to the upside potential in the stock, there's also a chance for APA to bulk up its fundamental position through key property acquisitions -- the article notes that the firm "has a history of augmenting its production volume growth through acquisitions." Plus, since the company's 11% debt ratio "is among the lowest in the sector," investors can breathe easy about APA's balance sheet.

If you're going to play the oil sector, it's much better to focus in on a lower-profile name, such as APA, rather than one of the bloated heavyweights in the group, such as Exxon Mobil (XOM). However, there are a few pressing technical concerns for APA at the moment, and contrarian investors will want to take note of the relatively heavy optimism surrounding the shares.

Specifically, the stock is poised to end the week below support at its 10-week moving average, and the shares have also pulled back beneath their 10-month trendline. In fact, since early May, APA has spent most of its time bouncing aimlessly between the $75 and $85 levels.

Despite the lackluster price action, option traders are favoring bullish bets. APA's Schaeffer's put/call open interest ratio (SOIR) of 0.60 ranks in the upbeat 18th annual percentile, and traders on the International Securities Exchange (ISE) have bought to open 3.41 times more calls than puts during the past two weeks. This ratio ranks higher than 86% of comparable readings during the past year, indicating that calls on the equity are in greater demand than usual.

In other words, traders seem to have high hopes for the stock, even as it's showing signs of a technical breakdown. Unless the shares can snap out of their sideways channel in short order, APA could be vulnerable to downside as disappointed bulls hit the exits.

Entertainment technology titan IMAX Corporation (IMAX: sentiment, chart, options) recently looked east for partners, inking a pair of deals with India's BIG Cinemas and China's Huayi Bros. This column touts the company's wherewithal to target "the world's two most populous markets," as India and China are home to 1.2 billion and 1.3 billion citizens, respectively.

"[The deals] are clearly incremental and provide a huge statement of IMAX's global reach," says the author. In fact, the columnist predicts that the deal in China "will likely inspire more Chinese theater operators to make the leap to IMAX," and deems the digital upgrade in Mumbai significant for both IMAX and antiquated theaters in the region.

The article concludes by acknowledging that the movie mogul may encounter some fundamental bumps along the way, but says that nevertheless, "there is strength in numbers for IMAX."

While IMAX's long-term fundamental prospects look promising, the stock may still be vulnerable to short-term selling pressure. Despite boasting a year-to-date gain of 63%, the shares – currently trading around $7.15 – are fast approaching potential resistance in the $8 region, which has halted several of IMAX's rally attempts during the past couple of years. In fact, the security hasn't conquered the $8 level on a weekly closing basis since August 2006.

However, like the aforementioned Motley Fool, analysts remain overly optimistic on the stock. According to Zacks, all six of the ranking brokers consider IMAX worthy of a "buy" or better rating, leaving room for potential momentum-killing downgrades should the equity get rejected at resistance yet again.

Furthermore, Thomson Reuters pegs the average 12-month price target on the security at a lofty $10.04, in a neighborhood IMAX hasn't explored in three years. A fresh wave of price-target cuts could also place additional selling pressure on the stock.

Overall, though extending the olive branch overseas may open doors for IMAX down the road – the deal in China won't even kick off until 2010 – the shares are still at risk of a pullback in the near term. Should the $8 level remain an impenetrable challenge on the charts, an unwinding of optimism on the Street could pressure IMAX into the red.

This article expresses a few concerns about the health of Illinois Tool Works (ITW: sentiment, chart, options); the author believes the shares are headed lower. While the company lifted its second-quarter earnings outlook on Monday, it remains a penny shy of the consensus estimate. Furthermore, "estimates can't possibly rebound sharply enough to justify the run-up in the stock."

Another concern is that the 13% of revenue that came from commercial and residential construction last year is still held back by sluggish housing starts and by a commercial real estate industry weighed down by an unemployment rate of 9.4%. And with $3.7 billion debt on the books, the author believes it will be more difficult for the CEO to buy the company out of this recession than it was in 2002, when the company was a simpler entity, and when those end markets were a lot less scary.

The author isn't the only one who is skeptical of the shares. Options players have loaded up on bearish bets, as the Schaeffer's put/call open interest ratio for ITW stands at 0.99, which is higher than 90% of all those taken during the past year. What's more, the International Securities Exchange (ISE) 10-day put/call volume ratio rests at 1.99, and is higher than 70% of all those taken during the past year. These lofty ratios indicate that investors have had a preference for puts over calls.

Furthermore, short sellers have flocked to this equity. During the past month, the number of ITW shares sold short increased by nearly 7% to almost 16 million shares. This accumulation is four times the stock's average daily trading volume.

Technically speaking, the stock has recently rebounded from its March lows and gained roughly 44%. The equity has even broken above resistance at its 10-week and 20-week moving averages. A continuation of the security's uptrend could force many of these bears to unload their short positions, pushing the equity higher.