1. Backdating to the Future at Adelphia

This week's nugget from the Adelphia Communications fraud and conspiracy trial: A former employee at the company -- a treasury supervisor who admits concocting a back-dated document and giving it to the company's auditors -- says he didn't do it to be deceptive.

"I knew the transactions had not happened, but I did not intend to mislead anybody," the Associated Press quotes James Helms as saying.

Instead, said Helms, he helped create phony bank documents to illustrate the movement of debt, acccording to the Associated Press and The Potter Leader-Enterprise.

Um, when financial employees start creating fake documents, we at the lab have a tough time figuring out how they could intend being anything but deceptive. What was he trying to be instead? Truth-telling? Surrealist? Thought-provoking?

The funny part is, this was a prosecution witness. Once it's the defense team's turn at bat, we can't wait to hear what kind of reasoning they'll come up with.

2. Take Two on Take-Two

You ever wonder why stock analysts are paid a lot of money? If you thought it was their ability to accurately forecast a company's prospects, you're wrong. No, we think it's their ability to get out there, day after day, and slog through all the crud that dumb companies throw at you to make an investment case that's plausible. Not necessarily right, just plausible.

Which brings us to RBC analyst Stuart Halpern, whom we're feeling kind of sorry for. On Wednesday morning, Halpern reiterated his Top Pick rating and $47 price target on Take-Two Interactive Software ( TTWO). Positive retailer comments about the video-game developer's forthcoming Red Dead Interactive, wrote Halpern, suggested that the title would exceed Wall Street's sales expectations. Projected unit sales for RDR, wrote Halpern, "would likely ensure a very profitable game and be enough to help Take-Two make Q2 and Q3 numbers."

So what does Take-Two do within minutes of Halpern's blasting out his report? Why, it chops huge numbers off its revenue and earnings guidance for the aforementioned second quarter, because the release of the aforementioned RDR would be sliding into its fiscal third quarter, which starts May 1.

Take Some More ...
... Take-Two shares

So much for Take-Two making Q2 numbers. The company's shares dropped 9% Wednesday. Granted, it wasn't RDR's slippage into the third quarter that was disheartening for Take-Two; the company also lowered estimates for the full year. And -- oh yeah -- the company's CEO resigned, too, a month after its chairman resigned, disclosing he faces possible civil charges from the Securities and Exchange Commission.

Now, if we were an analyst and we had the lousy luck to have something like that happen to one of our top picks, we'd find it pretty hard to get out of bed the next day. Or even hang around the office much longer after Take-Two's bad news came out.

But you can't let a dumb, red-flag-sprouting company get in the way of a plausible investment idea, we guess. On Thursday morning, Halpern again reiterated Take-Two as his Top Pick video-game stock, though he cut his price target $3 to $44. "'Revolving door' of management does not inspire confidence," Halpern wrote, "but the risk/reward is still compelling in our view. ... Our 'key asset valuation' ... suggests attractive upside-vs-downside prospects for the stock, in our view."

Obviously, we at the lab are too much the half-empty, downside-beats-upside types to be any useful as analysts. We left Halpern a message Thursday evening to see if he wanted to discuss the perils of being an analyst, but he didn't get back to us.

Low-fat caramel dipping sauce

3. McDonald's Gets McDefensive

In a sign of how much abuse McDonald's ( MCD) has to swallow these days, the company said Thursday it's launching a huge campaign to get Americans to lead healthy lifestyles.

Europeans? South Americans? You're on your own.

Anyway, it's bad news once you have to start shooting for an image implying that people shouldn't go overboard buying what you sell. Go ask Altria ( MO). Or Anheuser-Busch ( BUD).

But we have to give McDonald's credit for reframing the issue. The company isn't actually saying you should ease off the large fries in favor of some home cooking. No, that wouldn't be good for same-store sales. (Don't just pull an apple out of your fridge and eat it; no, McDonald's wants you to come in and buy their new Apple Dippers, which come with "low-fat caramel dipping sauce.")

The goal of Thursday's initiative is for people to achieve "better food/energy balance in their lives," explains McDonald's. "Food/energy balance is the simple equation of calories in/calories out."

Thanks for the help, guys. In the supply-demand equation that determine's McDonald's success, we had no idea that the problem was insufficient demand.

4. Coke In, Coke Out

It's getting hard to keep track of whether people are coming or going down at Coca-Cola ( KO) headquarters in Atlanta.

Earlier this week, proxy adviser Institutional Shareholder Service cited conflicts of interest when it suggested that Warren Buffett, the richest man in America and largest shareholder of Coke, should be off the company's board.

For Buffett, Coke offered an unequivocal defense: "We disagree with their analysis," the company said. "Mr. Buffett is a man with an eminent reputation for integrity and his effectiveness as an audit committee member is widely regarded."

But Coke was less resolute on the exit of its general counsel, Deval Patrick. On Sunday, Patrick resigned and was heading for the door. But by Thursday, Coke CEO Douglas Daft had done a 180, asking him to stick around to the end of the year, according to The Wall Street Journal.

No denying it here at the research lab: Coke does have its troubles, including some government investigations into its accounting practices. And now a senior executive appears to be out on Sunday and back on Thursday, raising questions about who's watching the shop.

Memo to Douglas Daft: What's next Doug? "New Diet Coke"?

5. Mike and The Alamo

Remember our ol' embattled pal Michael Eisner? (He's the CEO of the Walt Disney Co. ( DIS) He used to be the chairman.)

Mike had a little bit of good news this week that we here at the lab want to be sure to note. (Did we tell you that his shareholder meeting lasted five hours?)

Earlier this week, Disney said that it expects earnings growth of more than 40% from continuing operations in its current fiscal year. Not bad, Mike. But we're a little confused. Disney had previously said that it expects earnings growth of 30% this year. Then, after the company's new "blockbuster" film -- The Alamo -- went bust over the weekend, with analysts warning of a writedown, Disney raised its earnings outlook for the year. Gee, maybe we've all been a little too hard on Mike. If he can turn a box-office flop into higher earnings guidance, sounds to us like the ol' Disney magic is back!

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