Anyone buying BofA shares is making a home run-or-strikeout bet, not an investment. But the bank's chance of passing regulatory muster may be better than the bears say.

Bristol-Myers Squibb stock has fallen to around 18. Bulls think that, aided by good results or perhaps a takeover attempt, the stock could jump as high as 30 over the next year.

Wall Street has overreacted to a recent quarterly loss and the possibility of cutbacks in defense spending. That makes Northrop Grumman ripe for a 65%-plus rebound within 18 months.

After a ringing upside surprise in quarterly earnings reported last month, the stock is up a bunch from a Jan. 30 low of 2.40, but still trades at scarcely more than three times the $1 per share the company is projected to earn for the fiscal year ending March 31. This stark cheapness is related in part to its obscurity -- and its substantial debt load. AOI's net debt was $970 million at last quarter's end, a legacy of a merger with a competitor a few years ago. But the company has steadily paid down debt out of free cash flow. Half of the debt isn't due until at least 2012, and the rest is seasonal working-capital borrowings secured by tobacco inventories. The stock remains largely in the hands of index funds that must own it, and quantitative managers whose black boxes seem to seize on its low price-to-book value ratio and its penchant for running like a startled cat, in either direction. The stock's jumpiness and its low price place it in the not-for-the-fainthearted category. But in a market with elusive definitions of cheapness, AOI seems clearly to merit that designation.

With the stock-price spread between the two recently at a two-year high, Lowe's is now the cheaper stock based on forecast earnings, market value per retail square foot and cash flow (though not free cash flow, where Home Depot retains an advantage). A number of relative-value and spread-trading relationships have gotten out of whack in recent months, as leveraged arbitrage investors have been carried out of the arena. Yet betting on Lowe's to regain a bit of turf on Home Depot looks reasonably attractive.

Defensive industry groups like drugs and consumer products haven't been spared lately. The major drug stocks -- Pfizer (PFE), Lilly (LLY), Merck (MRK), Bristol-Myers Squibb (BMY) and Schering Plough (SGP) -- are down an average of 23% this year and now trade for an average 2009 P/E of just eight.

Defensive industry groups like drugs and consumer products haven't been spared lately. The major drug stocks -- Pfizer (PFE), Lilly (LLY), Merck (MRK), Bristol-Myers Squibb (BMY) and Schering Plough (SGP) -- are down an average of 23% this year and now trade for an average 2009 P/E of just eight.

Defensive industry groups like drugs and consumer products haven't been spared lately. The major drug stocks -- Pfizer (PFE), Lilly (LLY), Merck (MRK), Bristol-Myers Squibb (BMY) and Schering Plough (SGP) -- are down an average of 23% this year and now trade for an average 2009 P/E of just eight.