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Toll Brothers (NYSE: TOL - option chain) shares are soaring higher today after weekly mortgage data came out this morning that showed applications rose last week. This after yesterday's mixed numbers for new home sales caused at least one celebrity stock analyst to call a bottom in housing. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on TOL.

TOL opened this morning at $22.42. So far today the stock has hit a low of $22.33 and a high of $23.43. As of 12:15, TOL is trading at $23.43, up $1.10 (4.5%). The chart for TOL looks bullish and S&P gives TOL a positive 4 STARS (out of 5) buy ranking.

For a bullish hedged play on this stock, I would consider an October bull-put credit spread below the $17.50 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in just seven weeks as long as TOL is above $17.50 at October expiration. Toll would have to fall by more than 25% before we would start to lose money. Learn more about this type of trade here.

The auto industry is deep in the weeds right now, particularly in the United States. American manufacturers are hemorrhaging money -- General Motors (NYSE: GM) alone has lost $30 billion in the last three years -- as high gas prices and an (unofficial but very real) recession forces consumers to abandon their American-made trucks and SUVs by the millions.

Even with the pronounced shift toward smaller and more efficient cars, the overall auto market in the U.S. is shrinking thanks to the poor economy, and most manufacturers are selling fewer vehicles. But one company stands out as an exception to the rule of declining sales: Honda Motor Ltd. (NYSE: HMC). In the first seven months of 2008, Honda increased its sales by over 3%. By comparison, Chrysler lost 22%, GM fell 17%, Ford (NYSE: F) lost 14% and even mighty Toyota (NYSE: TM) saw a decline of 7%.

An interesting quote in The New York Times from Tetsuo Iwamura, the president of Honda's North American operations, sheds light on how Honda has managed this impressive feat. Honda, Iwamura said, "is a philosophy-driven company." And what is Honda's philosophy? According to Iwamura, "we want to make Honda the company that society wants to exist."

From an American perspective, this is an extraordinary statement. American automakers have followed a very different philosophy for many years, one in which fat and easy profits from poorly designed and hopelessly wasteful SUVs take precedence over the long term health of both the auto industry and society as a whole. But Detroit is suffering now for its short-term approach, while Honda is showing both consumers and investors the value of planning for the long run. And at $32 a share and a P/E of 10, Honda looks like a good long-term buy.

No one wants to own a gas station; the margins are too small. Consumers will only pay so much for petrol. If the price moves up, people begin to ride bicycles.

ConocoPhillips (NYSE: COP) will sell the last 600 stations it owns, walking away from a business that Exxon Mobil (NYSE: XOM) left just a few months ago. According to The Wall Street Journal, "ConocoPhillips is expected to sell the remainder of its 600 company-owned gasoline stations to closely held PetroSun West LLC for $800 million."

The announcement says a great deal about the perverse economics of the oil business. Due to the recent rise in oil prices, pumping oil out of the ground is an excellent business. The profits on $120 crude are stupendous. But the refining industry is awful. Trying to make margins on the gas and diesel from that high-priced oil is extremely difficult. Demand gets hammered by the consumer's inability to absorb the huge increase in fuel prices.

The question, of course, is why any company would get into the business. That says a great deal about the big oil company strategy of dumping stations. Either the people buying them are fools, or the profits in the sector will come back as gas prices drop. If so, Big Oil will look silly.

Douglas A. McIntyre is an editor at 247wallst.com.

Chrysler, owned by Cerberus Capital Management, has begun production of several hybrid vehicles as of last week, according to the troubled automaker.

Like its larger U.S. competitors, Chrysler is desperately trying to shift its product mix into more fuel-efficient cars, trucks and SUVs as buyers look for the best fuel economy possible while not giving up the creature comforts of gas guzzlers.

Chrysler is now building the Dodge Durango and Chrysler Aspen SUVs with hybrid capability in its Newark, Delaware plant and the company says both will be available on dealer showrooms soon. "Soon" can't come soon enough and it'll be interesting to see what gas mileage these SUVs have, even after undergoing a hybrid transformation.

Chrysler desperately needs a hit here, but this sounds like a "me too" approach similar to General Motors Corp. (NYSE: GM)'s Tahoe hybrid and other vehicles. Yes, the fuel economy moves into the V6 level with these hybrid SUVs. Will that make customers buy them at a time when 4-cylinder vehicles are blowing off dealer lots, though?

Honda (NYSE: HMC) is being appropriately praised for building its model line around fuel-efficient cars, as it has for years. According to The New York Times, "No major automaker in America is doing better than Honda, whose sales are up 3 percent for the first seven months of this year in a market that has fallen 11 percent."

Honda did not make big money on SUVs when they were the profitable sector of the market. Now, it is not taking huge losses and has net income that is the envy of Detroit.. But its strategy may be short-sighted, especially outside the U.S.

There is plenty of evidence that SUVs are extremely popular in China, the world's second largest car market. The vehicles also do well in the Middle East and some parts of Latin America. As gas prices increase, so does the temptation for governments in large nations to underwrite the cost of gas as is already the case in China. Because of this kind of policy, oil prices may stay high, but gas prices could drop.

Honda's long-term plan to be the provider of the cars that use the least gas may look good now, but petrol prices could swing down again. Then the company may not look so brilliant.

Douglas A. McIntyre is an editor at 247wallst.com.

Brinker International (NYSE: EAT - option chain) shares are headed lower today. Last week, an analyst expressed concerns about potential weakness in the casual dining sector due to families that may have stayed home to watch Olympic coverage rather than going out for dinner. Today, there is some weakness throughout the sector, on stocks like Darden (NYSE: DRI) and Cheescake Factory (NASDAQ: CAKE) as well. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on EAT.

This morning, EAT opened at $19.34. So far today the stock has hit a low of $18.87 and a high of $19.41. As of 12:15, EAT is trading at $18.95, down 62 cents (-3.2%). The chart for EAT looks neutral and S&P gives EAT a neutral 3 STARS (out of 5) hold ranking.

For a bearish hedged play on this stock, I would consider an October bear-call credit spread above the $22.50 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in two months as long as EAT is below $22.50 at October expiration. Brinker would have to rise by more than 18% before we would start to lose money. Learn more about this type of trade here.

EAT hasn't been above $22.50 since May and has shown resistance around $21 recently.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in EAT, DRI, or CAKE.

The Olympics were supposed to be NBC's big profit engine for this year. The unit has been something of a disappointment to parent General Electric (NYSE: GE), but one event could have changed that.

Indeed, NBC's ratings for its Olympic programming seem to have been outstanding and its broadcast revenues for the event may set a record for TV ad income for sports programming.

But internet revenue for NBC's coverage may be remarkably small. According to The Wall Street Journal, "NBCOlympics.com will generate just $5.75 million in video-ad revenue from the Games, according to estimates from research firm eMarketer Inc." Some of the disappointing numbers could come from the decision to run only a modest amount of coverage on the website, but the problem may by much greater than that.

Web video may be a bust, at least from a revenue standpoint. There is more and more evidence that points in that direction. YouTube has certainly been a huge disappointment for Google (NASDAQ: GOOG). Viacom has struggled with making big money off the online version of MTV. Video has done very little to bring extra revenue to Facebook and MySpace.

The problem with selling video commercials on the internet could be that consumers have come to expect that everything online is free. Banner ads and search ads are easy to avoid as there is nothing active or intrusive about them. Video ads often start to play whether the person online wants to see them or not. That may lead to a rejection of the experience altogether.

Making cash on web video may never work. The media companies just don't want to admit it.

Douglas A. McIntyre is an editor at 24/7 Wall St.

August is expected to be another troubling month for domestic cars sales. U.S.-based car companies have seen sales off over 20% in some recent months. If August does not show some minor improvement, the rest of the year could be more of a disaster than expected.

General Motors (NYSE: GM) has offered amazingly attractive incentives on its vehicle line including "employee pricing," cash back and low interest rates. With all of those in play, the largest U.S. car company should have a reasonably good month. Or, that is what the market is hoping for.

The Wall Street Journal writes that J.D. Power & Associates expect August sales to be a modest improvement from July. If that does not happen, it will be a catastrophe. It would say that even aggressive pricing cannot bring wary consumers back into the car market; that falling consumer income cannot overcome the allure of even the best deals.

The potential car customer may be so broke that he can't even afford to take a car for free. The gas will cost too much.

Douglas A. McIntyre is an editor at 247wallst.com.

The United States is a nation whose electric power generation system and grid is becoming increasing inadequate, even as the nation grapples with another energy problem -- the $4 per gallon gasoline era.

Moreover, an economic slowdown and a relatively mild summer have to-date reduced the typical electric load electric power generation plants would face, but that respite will end when the U.S. economy starts to expand at a healthy rate again. And when it does, electric power demand will increase.

What's one model the United States could follow to generate more electricity while the same time reducing coal-based pollution and climate change? France.

That's right: France. Nuclear power is experiencing a mild comeback in the United States, with 34 new reactor applications on file at the U.S.'s Nuclear Regulatory Agency. In France, it never left. Further, had the United States followed the French model, the U.S. would be vastly more energy self-sufficient today.

France: liberty, fraternity, equality, fission

Nuclear power never went out of style in France, and for this reason France is decades ahead of the United States -- and much of the world, for that matter -- regarding energy self-sufficiency, The New York Times reported. An astounding 77% of France's electricity comes from its 58 nuclear power plants, and it is a net-exporter of electricity to Europe. The United States has 104 nuclear power plants, which account for only 19.4% of its generated electricity, according to U.S. Department of Energy data, The Times reported.

With all of the success of the Apple (NASDAQ: AAPL) iPhone and the RIM (NASDAQ: RIMM) BlackBerry, investors would think cellphone sales in the U.S. are booming. That assumption is wrong.

In the second quarter, handset sales in the U.S. fell 13% according to NPD Group, dropping to 28 million units. According to The Wall Street Journal, "That is the lowest number of phones sold in a quarter since NPD began tracking the category in 2005."

Motorola's (NYSE: MOT) market share fell from 32% last year to 21% in the second quarter this year.

The news shows the extent to which handset companies will have to rely on sales in emerging markets like China if they are going to continue to growing. Although recent figures for Europe are hard to come by, it is likely that sales growth there has slowed or has gone negative. In both the U.S. and EU there are almost as many cellphones as there are people and the economy is making it harder to sell replacement handsets.

While the new numbers say more a great deal about the near-term future of the major handset companies and the challenges they face for earnings, the data speaks volumes about Motorola. The company has modest market share outside the U.S. and its domestic market has been its salvation. That is clearly no longer the case.

Motorola plans to spin-off its handset unit next year. But its revenue is falling at the rate of about a third compared to last year and it loses several hundred million dollars a quarter. If the U.S. market turns against the company, shareholders have to ask if the unit has any value at all.

Douglas A. McIntyre is an editor at 247wallst.com.

One of the few hopes the U.S. car companies have had is that they have been perceived as closing the quality gap with Japanese models. Recent JP Power data shows Detroit running in a dead heat with imports in the consumer satisfaction race.

That bubble has been at least partially burst due to new information from the University of Michigan's American Customer Satisfaction Index. According to the AP, "U.S. car buyers are growing less satisfied with their purchases from domestic automakers while their Asian and European competitors continue to improve."

In the new survey, BMW and Lexus tied for the top spot followed by Honda (NYSE: HMC) and Toyota (NYSE: TM). Several brands from GM (NYSE: GM) and Ford (NYSE: F) dropped down the rankings.

At the risk of stating the obvious, Detroit is in such deep trouble that a perceived drop in the quality of its cars can only make its recovery more difficult. There are several ways around that, but none of them are very palatable.

GM yesterday introduced buyer incentives across most of its brands. That means its margins on those vehicles will be lower. It may pick up some market share, but any victory there will be costly. The U.S. car companies are cutting their marketing budgets, so they cannot "advertise" their way out of the problem.

Effectively giving cars away can certainly help hurdle the quality barrier, but losing a lot more money could sink a large U.S. auto company.

Douglas A. McIntyre is an editor at 247wallst.com.

The FCC is looking at using part of the TV signal spectrum to provide wireless high-speed internet. It is a brilliant idea that is being opposed by a large part of the television industry.

According to The Wall Street Journal, "The Federal Communications Commission will have the final say in the battle between the broadcasters -- which fear interference on the airwaves they'll still be using -- and the companies including Google Inc (NASDAQ: GOOG). and Motorola Inc. (NYSE: MOT) that want to share the television airwaves."

The fight is a classic example of old media not wanting to give up something that it has "owned" for years because it may help new competition.

Tough luck. Broadband adoption in the U.S. is behind several countries in Europe and Asia, and if the FCC can offer an inexpensive solution to that, it should. The new over-the-air system would have many of the benefits of Wi-Fi, but would be more broadly available.

TV broadcasters say that the new technology could interfere with their signals, but testing can demonstrate whether that is true or not. The FCC has the chance to move broadband adoption forward with one spectacular decision. It should not balk at the chance.

Douglas A. McIntyre is an editor at 247wallst.com.

For the most part, the Cadence Design Systems (NASDAQ: CDNS) unsolicited offer for Mentor Graphics (NASDAQ: MENT) was a smart move (both companies are leaders in semiconductor design software). This transaction would be a critical part of consolidation in the industry.

However, on Friday, Cadence decided to drop its $1.6 billion bid. As a result, the shares of Mentor plunged 25%.

What happened here? Well, according to Cadence, it looks like the board of Mentor didn't want to open its books (although, Mentor disputes this). Another issue is antitrust. Oh, and with the credit crunch, it's still pretty tough getting financing.

Perhaps the big problem is the slowing economy, which is putting pressure on the semiconductor industry. After all, Cadence posted weak Q2 results, and the outlook looks dismal.

Whatever the reasons, Wall Street likes the result. On the news, Cadence's share increased 6.7%.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

The idea that the huge financial services conglomerates should be broken up has been around for a long time. The fact the UBS (NYSE: UBS) is cutting itself into pieces has brought the debate back to the fore.

To some extent taking a company like Citigroup (NYSE: C) and carving it up would allow investors to get shares in some of the good divisions along with the bad. At that point, at least shareholders could decide what they wanted to hold. The original idea behind merging bank pieces together was that if one segment of the business got in trouble, others could do well. Earning would be supported through diversity. Recent quarterly statements have shown that theory holds little water.

According to the AP, "Ladenburg Thalmann's Richard X. Bove, one of the most outspoken banking analysts since the credit crisis began last year, wrote in a note that the 'concept behind the creation of JPMorgan Chase has broken down.'" Bove's view is not longer part of a tiny minority.

The trouble with the thinking is that it is hard to see how it would work in practice. Can Citi simply be split into four or five pieces, each with its won management and fate? It worked for AT&T 30 years ago, and investors were the better for it. Perhaps it is the banking industry's turn.

Douglas A. McIntyre is an editor at 247wallst.com.

Toyota Motor Corp. (NYSE: TM) says that a hybrid version of every one of its vehicles will be available by 2020.

According to The Wall Street Journal, "The announcement came as all of the auto makers at an industry conference this week in northern Michigan maneuvered to carve out their own niches in fuel-efficient design."

But, 12 years from now, hybrids may be useless.

Nuclear energy may drive 100% of the U.S. needs for electric power.

The massive oil reserves found off Brazil and in the Arctic may have driven up oil supplies so that gas is back to $1.25.

Wind power may have undercut the need for oil-heat in many American homes.

Solar power will probably have replaced other fuels for furnishing most homes and small businesses with energy.

The hybrid car may not be such a great idea.

Douglas A. McIntyre is an editor at 247wallst.com.