MOST NOTEWORTHY:

• Credit Suisse initiated coverage on U.S. banks, starting shares of BB&T Corporation (NYSE: BBT), Colonial BancGroup Inc (NYSE: CNB) and Zions Bancorporation (NASDAQ: ZION) with Outperform ratings.
• Banc of America assumed coverage of the oil refiners but remains neutral on the group given near-term risks to gasoline inventories and margins. They assumed Valero Energy Corporation (NYSE: VLO) with a Neutral rating and $60 target and Western Refining Inc (NYSE: WNR) with a Sell rating and $35 target.
  
• Cantor believes SGX Pharmaceuticals Inc's (NASDAQ: SGXP) platform technology for the treatment of cancer provides significant advantages that can accelerate drug discovery and lead optimization, while lowering costs. The firm started shares with a Buy rating and $9 target.

• Morgan Keegan started shares of Motorola Inc (NYSE: MOT), Apple Inc (NASDAQ: AAPL) and Napster Inc (NASDAQ: NAPS) with Market Perform ratings and RealNetworks Inc (NASDAQ: RNWK) with an Outperform rating.
  
• Lehman initiated shares of Time Warner Inc (NYSE: TWX) with an Overweight rating and $25 target.
  
• Virtusa Corporation (NASDAQ: VRTU) was assumed with an Overweight rating at JP Morgan and with an Outperform rating and $16 target at Bear Stearns.

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As the world's payment systems shift from paper to pulse, world commerce becomes increasingly dependent on the reliability and integrity of transaction software specialists. Among the leaders in the field is a New York firm that has been serving financial clients for almost thirty years.

Transaction Systems Architects (NASDAQ: TSAI) sells software products and services that make electronic payments possible. The programs process transactions involving ATMs, credit cards, debit cards, wire transfers, home banking services and point-of-sale terminals. Company services involve design, implementation and facilities management. Customers include financial institutions, retailers and e-payment processors. Bank of America (NYSE: BAC) and BB & T Corporation (NYSE: BBT) are two of the big names on the firm's client list. First Data Corporation (NYSE: FDC) is a major competitor.

The company updated its 2007 estimates last month, predicting adjusted EPS of $1.51-$1.80 and revenues of $428-$447 million. Those ranges encompassed the consensus Street views of $1.66 and $436 million. The news helped to keep TSAI shares cycling through a positive seven-week trading channel. The price is currently consolidating at the base of that channel, where oversold Momentum, Stochastic, CCI and MACD technical parameters suggest the potential for a rise back toward the top. The approximate correspondence of the stock's 50-day moving average to the base of the channel backs the rebound notion.

Brokers recommend the issue with four "strong buys," one "buy" and one "hold." Analysts see a 49% growth rate, through the next year. The TSAI PEG ratio (1.2), Price to Free Cash Flow ratio (22.89), Return on Assets (12.33%) and Return on Equity (22.85%) compare favorably with industry, sector and S&P 500 averages.

Institutions hold about 95% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $28.10 and $38.72. A stop-loss of $29.00 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.

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BB&T (NYSE: BBT) recently released 1Q 2007 figures. In those areas of operations affected by interest rates, the news is nothing to boast of. Net income for 1Q 2007 was $421 million, $0.77 per diluted share. This is down 2.5% from 1Q 2006. Shareholder equity also declined by 1% from 1Q 2006. BB&T CEO John Allison states that he is nonetheless pleased with BB&T's 1Q performance, given "a challenging interest rate environment and a slowing economy." Allison points out that BB&T still experienced both loan and deposit growth during 1Q 2007.

The upside of a slowing economy is that more people need to borrow more money, or need fee-earning services to help them move money around more efficiently. All of BB&T's noninterest income generating business units had a good quarter. Total non-interest income was up 7.2% to $652 million for the quarter. These units included insurance operations for property and casualty coverage, which experienced 11.9% growth to $197 milion, based mainly on higher insurance commissions. Revenue from trust administration services increased 8% to $40 million. Service charges for overdrafts were also a big money maker for BB&T, increasing over 5% to $138 million just for 1Q 2007. That's a lot of bouncing checks covered. Credit card related services increased almost 12% to $114 million for the quarter.

BB&T grew both organically and by acquisition during 1Q 2007. Average loans and leases increased 12.5%, $9.5 billion, to just shy of $85 billion for the quarter. Across the board, commercial loans and leases, as well as consumer mortgages and loans increased in size. BB&T also acquired AFCO Credit Corporation, with over $1 billion in its loan portfolio. Not everybody was trying to borrow more money. Average deposits, both commercial abd consumer, increased %11 to $82.5 billion. And BB&T is aggressively expanding its online banking services to capture even more deposits at a reduced cost. BB&T added over 5,000 new online banking accounts in 1Q alone.

Also during 1Q, BB&T bought Coastal Financial Corporation for $395 million. This will give BB&T numerous retail locations in the high-growth areas of the Carolinas, in addition to BB&T's 1,400 existing locations in 11 states. This far, the slowing economy has been good news for BB&T.

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MOST NOTEWORTHY:

• Stifel initiated Wells Fargo (NYSE: WFC) with a Buy rating and $41 target as they believe the company is best in class given its strong capital position, effective risk management and better than average EPS growth rates.
• Stifel initiated with a Hold rating: Bank of America (NYSE: BAC), Wachovia (NYSE: WB) and Fifth Third (NASDAQ: FITB).
• Stifel transferred coverage of the following names with Hold ratings: BB&T Corp (NYSE: BBT), Comerica IncCMA), SunTrust Banks (NYSE: STI), US Bancorp (NYSE: USB). Note USB was transferred and downgraded to Hold from Buy.
• Stifel initiated Regions Financial (NYSE: RF) with a Sell rating and $33 target as they believe the AmSouth merger is likely to prevent a near-term catalyst, and transferred coverage of National City (NYSE: NCC) with a Sell rating and $33 target, downgraded from Hold, as they believe consensus estimates need to come down to reflect several challenging trends.

• JMP Securities started TiVO Inc (NASDAQ: TIVO) with a Market Outperform rating, expecting the company to gain a larger piece of the DVR market in the late spring/early summer.

• Wedbush initiated Lions Gate Entertainment Corp (NYSE: LGF) with a Buy rating and $13 target.

• BMO Capital started Bristol Myers Squibb (NYSE: BMY), Wyeth (NYSE: WYE) and Pfizer Inc (NYSE: PFE) with Market Perform ratings and Eli Lilly (NYSE: LLY), Merck & Co (MRK) and Schering Plough (NYSE: SGP) with Outperform ratings.

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