Marathon Oil Corporation (MRO: 30.88 0.00%) is one of the safest oil stocks in the market with its dual focus on exploration and refining. Often times when oil prices rise, exploration companies do well as the oil they extract from the earth is worth more. Meanwhile, refiners face pressure trying to push the prices increases on to consumers slowly. Conversely, when oil prices fall, exploration companies face pressure and refiners can more slowly lower the prices.

Marathon Oil’s integrated operations also ensure that no profit is lost through a middleman. Oil obtained through its exploration division can immediately be routed to its refining division and delivered to customers through its gas stations. Typically, much of the profits from oil exploration dissipates as it works its way down the line to consumers. Marathon Oil is able to capture this value by keeping its operations all in-house and tightly operated.

Finally, Marathon Oil offers a healthy 3% dividend yield and is trading at an attractive price-earnings ratio of just 4.33x. This compares to Exxon Mobil’s 2.28% dividend yield and 9.76x price-earnings ratio. Obviously, the reason for this under-performance is the high price of oil (and Exxon is skewed towards exploration), but an anticipated drop in oil may help Marathon Oil outperform.

Philip Morris International Inc. (PM: 50.38 0.00%), an international tobacco company, is one stock that income investors may enjoy. The cigarette manufacturer and distributor is trading with a price-earnings multiple of 13.53x and a dividend yield of 4.9%, which means it could provide strong capital appreciation and dividend income over the long-term.

Despite the strong fundamentals, there are some risks associated with Philip Morris. Industry regulations are consistently a problem for cigarette manufacturers, as higher taxes could lead to lower sales over the long-term. However, strong demand in Latin America and overseas has helped drive revenues and profit margins despite a difficult domestic market.

Some investors are also concerned with Philip Morris’ ability to pay its steep dividend yield. However, a quick look at analyst estimates shows that the company should earn at least $3.00 per share this year, which is more than enough to cover its $2.16 per share dividend outlay. In fact, some investors are even confident on the company’s potential as a capital appreciation stock.

In the end, Philip Morris may not be the fastest growing stock in the world, but it’s a defensive play that income investors can appreciate in these tough economic times.

Earnings per share: $0.70.With seven analysts offering coverage and estimates ranging from $0.48 to $0.97, even the high end of the spectrum would be a marked decline over last year’s strong $2.46.

Revenue: $299.79 million. Expect a 23.9% drop from $394 million last year.

Trackrecord: Poor. The company has disappointed in three out of its last four quarters by at least 6.4%.

Recommendation: “Buy” leaning slightly towards “Strong Buy” with an average price target of $20.71 for the company’s shares with seven brokers offering coverage.

Criticizing the heart of value investing, which is the “Buffett Way,” Ben Steverman writes that in this recession “value has proven to be a slippery concept.” Certainly financial stocks are difficult to value given the complexity of financial insturments, but other than this particular example (which is the only one the article uses), how exactly has the recession changed how business work? “‘It’s only a value if you can accurately assess today what the future profits will be,’” says an analyst the article quotes - very true, but also very obvious. Value investing has always hinged on determining future profits. These are only criticisms, or newly apt criticisms to be more precise, if there is some reason the recession has made this significantly more difficult for most companies.

Then the article commits the Cardinal Sin of value investing- attempting to time the market. Here is the excerpt:

Value investors might think long term, but that’s a problem when the stock market is moving very quickly. Stocks lost a third of their value in one month last fall, and jumped 20% higher in three weeks this March. Buy or sell a position too early or too late and the effect on your portfolio could be disastrous.

This is so obvious as to not even be necessary to write, but if you bought Company XYZ at $10 a share and it was indeed a value, when the price drops to $5 a share it was still a value at $10! Shocking, but true. So long as you were correct in your original judgment (that the shares were a value at $10), time will vindicate your purchase despite the subsequent price drop. “The effect on your portfolio could be disastrous” if you are planning to invest only for the short-term, which contradicts not only value investing but even the author’s opening statement of the paragraph describing value investing, “Value investors might think long term.” No, value investors are thinking long term.

The article closes with two irrelevant sections. The first compares large cap value mutual funds to other funds, but I stopped caring when mutual fund comparisons were used. A mutual fund can call itself whatever it wants, that doesn’t mean it executes the strategy properly.

The second closing point once again moves to financial stocks, which obviously have their problems.

With financial reporting like this, it is no wonder the economic collapse came as a surprise.

Buoyed by unexpectedly strong earnings at Best Buy Co. (BBY: 38.91 0.00%) and the news that General Motors Corp. (GM: 0.75 0.00%) had an addition 7,500 employees take early retirement in an effort to curb labor costs, the S&P 500 continues its rally.

Macroeconomic data showing better-than-estimated growth in durable-good orders and home sales has also helped stocks advance.

Earnings per share: 66 cents. Granted, it is a staggering 85% drop from year ago earnings of $4.50 in the fourth quarter, but with shares down more than 90% over the past 12-months this kind of drop is already priced-in. With 7 analysts offering coverage, estimates range from 60-70 cents.

Revenue: $209.5 million. The 9 analysts offering coverage expect a 10% drop from a year ago, with estimates ranging from $190-221million, well below last year’s $233.38 million.

Trackrecord: Mixed. DryShips has missed earnings expectations twice and exceeded them twice in the last four quarters.

Trend: Terrible. Not surprisingly, earnings expectations have fallen from $1.24 per share three months ago to the current level of 66 cents per share.

Recommendation: “Sell,” though the average price target is still $8.31 per share with 9 analysts offering an opinion.

Earnings per share: $1.48. With 8 analysts offering estimates ranging from $1.42-$1.54, the average estimate of $1.48 represents a 12% drop from year ago earnings of $1.69 – not surprising given this quarter’s reliance on holiday sales.

Revenue: $1.75 billion. Analysts expect fourth quarter sales to mirror the drop in the company’s holiday sales, which were also down around 5% from the year before. Barnes & Noble had $1.85 billion in sales a year ago, though estimates range from $1.73-$1.81 billion.

Trackrecord: Mixed. Though the company has missed analysts’ expectations in two of its last four quarters, it had a major positive surprise as well – beating estimates by 66.7% in its usually mediocre second quarter.

Trend: Negative. Over the past 90 days, analysts’ EPS estimates have slipped from $1.51 to $1.48.

Recommendation: “Hold,” with an average price target of $16.17 per share with 6 analysts offering an opinion.

Earnings per share: $0.48. Expect a decline of about 9% from last year’s $0.53, though analysts’ estimates range from $0.43-$0.51.

Revenue: $959.4 million. Analysts expect sales to be down 1.7% compared to last year’s $976 million, with even the high-end of analysts’ expectations only $971 million.

Trackrecord: Poor. Cintas has missed EPS expectations in three of its last four quarters, most recently by 13%.

Trend: Negative. Not surprisingly, analysts have become more pessimistic about this quarter’s results. Average EPS estimates have slid from $0.55 three months ago to $0.48 now.

Recommendation: “Buy” leaning towards hold with an average price target of $26.67 with 6 analysts offering coverage.

Earnings per share: -$1.64.With 6 analysts offering coverage and estimates ranging from -$0.86 to -$2.61, even the low end of the spectrum would be an improvement over last year’s catastrophic -$12.51.

Revenue: $241.4 million. Expect a 14% drop from $281.48 million last year.

Trackrecord: Poor. PMI has disappointed in three out of its last four quarters by at least 69%.

Recommendation: “Hold” leaning slightly towards “sell” with an average price target of $4.50 for PMI shares with 3 analysts offering coverage.

Earnings per share: -$0.15. With only two analysts offering coverage, their estimates are -$0.09 and -$0.20 respectively – look for actually results to be around -$0.20 if not lower. A year ago, Jamba lost $0.26.

Revenue: $59.4 million. Sales are expected to increase by 9% over last year, but analysts worry that Jamba’s lack of a full menu combined with other companies, like McDonalds’, entering the juice market will ultimately stifle Jamba’s long-term growth.

Trackrecord: Amazingly bad. Jamba disappointed by -2,200% and -8,350% in the last two quarters – both times turning small expected losses into rather large losses. The actual percent surprise is pretty arbitrary (it is so large because in both quarters estimates were right around -$0.01, leading deviations to be huge based on percentages), but the takeaway point is that Jamba is a perennial loser.

Recommendation: “Hold” leaning towards sell with the two analysts offering coverage both putting a price target on Jamba shares of $1.