This coming week we have many key issues coming front and center in our list of “Unusual Suspects.”  Some are ongoing issues with mergers and the waves of earnings reports seem to be quieting down considerably.  We had big news from Berkshire Hathaway Inc. (NYSE: BRK-B, BRK-B) this weekend and expect more coverage Monday on this.  We are also watching The Chile Fund Inc. (NYSE: CH), iShares MSCI Chile Investable Market Index (NYSE: ECH), and National Bank of Greece SA (NYSE: NBG) for international macroeconomic and social events.  We also have coming events this week in CombinatoRx, Incorporated (NASDAQ: CRXX), Costco Wholesale Corporation (NASDAQ: COST), Toyota Motor Corp. (NYSE: TM) and Ford Motor (NYSE: F).  Other issues to watch closely this week are Dr. Reddy’s Laboratories Ltd. (NYSE: RDY), Millipore Inc. (NYSE: MIL), Palm Inc. (NASDAQ: PALM) and SIRIUS XM Radio Inc. (NASDAQ: SIRI).

We have given some wide expectations, issues to watch, and background data on each stock for this coming week.

Berkshire Hathaway Inc. (NYSE: BRK-B, BRK-B) released the Annual Letter to shareholders from Warren Buffett this weekend.  Buffett was far more confident than last year’s dreadful letter and with reason, most of his positions are now well above water.  We have noticed how short sellers have attacked the Buffett stocks in the most recent data from last week.  Buffett will be on a 3-hour breakfast chat with Becky Quick on CNBC Monday morning, so Buffett headlines are likely to rule for at least all of Monday.

The Chile Fund Inc. (NYSE: CH) as a closed-end fund and the iShares MSCI Chile Investable Mkt Idx (NYSE: ECH) as an ETF are going to be important to watch.  This is on the heels of an 8.8-magnitude earthquake that severely damaged Chile over the weekend.  We do not have a count on deaths and injuries yet, but this may interrupt the country’s GDP growth significantly in 2010.  It is always to cover issues from these in a few sentences when you know how much pain and suffering is happening.

CombinatoRx, Incorporated (NASDAQ: CRXX) fell on Friday ahead of the Monday March 1 FDA PDUFA goal date for the review of its Exalgo™ extended-release opioid painkiller tablet new drug application.  This NDA application date was moved from Monday, February 22, 2010 to Monday, March 1, 2010 due to federal government closings due to snow.  This can be a make or break event due to its micro-cap status. Shares closed down 8% at $1.12 on more than 200% normal trading volume on Friday.  The 52-week trading range is $0.41 to $2.60.

Costco Wholesale Corporation (NASDAQ: COST) is scheduled to report earnings Wednesday morning.  Thomson Reuters has estimates of $0.71 EPS on about $18.5 billion.  We remain focused on valuation here at more than 20-times 2010 earnings estimates and at $60.97 it is within 1% of its 52-week high of $61.52.

Dr. Reddy’s Laboratories Ltd. (NYSE: RDY) was given a very positive article in Barron’s over the weekend.  The Indian generic drug company closed at $24.61 in its USD ADR and two analysts predicted it could run up to $29.63 and to $30.82 as its sales are expected to double to $3 billion in 2013. It was noted that GlaxoSmithkline (NYSE: GSK) was interested in taking a stake.  Its 52-week range is $7.27 to $27.33.  If the markets are flat or solid, it seems that Dr. Reddy’s may have up to a 2% or so Barron’s-pop.

Millipore Inc. (NYSE: MIL) has yet to show that a bid is on the table above that it is ‘exploring strategic alternatives’ after  last week’s M&A leak.  The $6 billion said to be on the table from Thermo Fisher (NYSE: TMO) is said to include debt and there were late-week rumors that 3M Co. (NYSE: MMM) may join the fray here to add Millipore in with its Cuno operations.  If a deal is going to come, we’d look for more news on Monday or Tuesday rather than this story just dying down.

National Bank of Greece SA (NYSE: NBG) has become the go-to stock proxy for a vote on the future of Greece in its steady troubles with the Euro.  There are mixed reports over Greece’s bailout. The WSJ has said over the weekend that a package is coming by Friday, yet Germany’s Merkel has said the IMF is the only agency which can save Greece, according to a Handelsblatt report.  The National Bank of Greece SA (NYSE: NBG) will be THE proxy to watch.  As recently as November the Greek ADR would trade a mere half million shares per day.  Now that number is closer to 2 million shares per day.  This is the proxy to watch Monday for the Greece bailout situation.

Palm Inc. (NASDAQ: PALM) was given the ultimate pan this week by Wall Street and Barron’s is only adding fuel to the fire here.  Barron’s argues its phones are great and that no one is buying the things as they opt for just about every other maker.  And its expanded carrier plan still is weak, as are the promotions and the advertisements.  I noted how options traders were betting on even more and more downside over at OptionsZone.com this last week despite the selling which had already been seen.  Barron’s notes the hope of a takeover, but also noted the chances being a long shot from Dell or H-P… Now Barron’s gave this the ultimate snub: “without some surprise news, Palm could drift back down toward $3….”  Palm started last week above $9.00 then down close to $8.00 before dropping the ball about its warning and shares went down to $6.53. With a 6.7% drop to $6.09 Friday, Barron’s is calling for another 50% drop.

SIRIUS XM Radio Inc. (NASDAQ: SIRI) broke under $1.00 briefly Friday and shares closed down 4.6% at $1.02 on Friday.  After the company posted positive earnings and then traded as high as $1.18, we promised late on Friday to give an updated outlook.  I have been behind the company for a rather long time… down at $0.15 and under, and I had noted to buy the shares, take physical delivery of the shares, and stick them in a drawer.  It is time to lighten up here.  The stock can rise, but the implied dilution from Malone and Liberty here is just too great.  The Pandora competition coming in March and even the Howard Stern contract game are two sideshows in our analysis.  Its 3.6 billion shares already are one thing, but if Liberty were to covert its convertible preferred stake we’d be somewhere around 6.45 billion shares trying to try to capture some of the implied value at more than $2.5 billion today.  The ride might not be over, but smart money would take at least half of the position off the table now.

Toyota Motor Corp. (NYSE: TM) and Ford Motor (NYSE: F) are on deck for February auto sales on Tuesday.  There is now way that weather in the mid-Atlantic and Northeast will not have played a role in hurting the sales comparisons to 2009, but we are going to get to see just how poorly Toyota’s recalls are hurting Toyota and just how much Ford has been able to capitalize in market share.  Edmunds noted the lowest Toyota market share in years, yet the stock has not busted really under $71 and traders have supported it.  Dennis Gartman on CNBC Friday just said he prefers to be long Ford.

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JON C. OGG

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