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Editor's Note: The following article was written by Raymond James Chief Investment Strategist Jeff Saut. It has been reproduced with permission for the benefit of the Minyanville community. It’s been said that “in horseshoes and hand grenades ” all you have to do is “be close” to be a winner. Similarly if you are nearing either a downside or upside inflection point in the stock market all you have to do is be close to make money. With that thought in mind  I entered last week suggesting we were close to a downside inflection point in the equity markets ...

Stocks In Focus For Tuesday

Lehman To Be Taken Off Of S&P 500, To Be Replaced By Harris

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"Command, control, communications, computers, intelligence, surveillance and reconnaissance -- or C4ISR -- is the new face of the military," says Gregg Early.[More...]

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Filed under: Earnings reports, Forecasts, Economic data

With a turn of the calendar page, we drift into the middle portion of the current quarter, but the earnings season rolls on. Among the many companies scheduled to report quarterly results this coming week are Time Warner Inc. (NYSE: TWX), Cisco Systems Inc. (NASDAQ: CSCO), News Corp. (NYSE: NWS), and Whole Foods Market International (NASDAQ: WFMI). Let's take a look at which companies Wall Street analysts are expecting to be among the top earnings gainers and decliners this week.

Analysts surveyed by Thomson Financial expect the following to report strong earnings growth when compared to the same period of the previous year.

• DRS Technologies Inc. (NYSE: DRS): $0.85 EPS (+95.3%) on revenue of $823.8 million (+12.0%)
• Integrys Energy Group Inc. (NYSE: TEG): $0.40 EPS (+70.0%) on revenue of $2.6 billion (+9.7%)
• Cimarex Energy Co. (NYSE: XEC): $2.53 EPS (+64.4%) on revenue of $599.9 million (+75.4%)
• Forest Oil Corp. (NYSE: FST): $1.51 EPS (+55.6%) on revenue of $456.1 million (+79.1%)
• Devon Energy Corp. (NYSE: DVN): $3.28 EPS (+48.5%) on revenue of $4.1 billion (+38.5%)
• CMS Energy Corp. (NYSE: CMS): $0.13 EPS (+46.2%) on revenue of $1.4 billion (+6.7%)
• Transocean Inc. (NYSE: RIG): $3.23 EPS (+43.0%) on revenue of $3.1 billion (+112.9%)
• Sara Lee Corp. (NYSE: SLE): $0.26 EPS (+38.5%) on revenue of $3.5 billion (+8.9%)
• Williams Companies Inc. (NYSE: WMB): $0.69 EPS (+37.7%) on revenue of $3.4 billion (+20.0%)
• Harris Corp. (NYSE: HRS): $0.99 EPS (+28.3%) on revenue of $1.4 billion (+18.0%)

Continue reading The week in preview: Expectations remain high for energy and oil

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"You know what the news is-- in a minute, you're going to hear the rest of the story"- Paul Harvey If the stock market has taught us anything over the years, it is to expect the unexpected. This holds true for good news as well as bad. As I see it, the subprime mess does not have enough muscle to throw a monkey wrench into the economy. Sure, it can upset the apple cart, but alone it cannot destroy the economy. This being said, what can destroy the economy is the spillover effect which stems from defaults on prime mortgages, lines of credit, credit cards, car payments, etc... These problems occur when sky high energy and commodity prices are eating away at the discretionary incomes of consumers. Driving... [More...]

Filed under: Major movement, Deals, Rumors

Bloomberg News reports that Harris Corp. (NYSE: HRS) denied rumors that it is seeking a takeover. The stock is down 16% on that announcement. However, Harris did say that it has received expressions of interest.

This shows how treacherous it can be to invest in takeover rumors. I reported on such a rumor on May 16. Between that report and Friday, Harris stock rose 6% from $62 to $65.78. But with this morning's denial of takeover rumors, that entire gain is lost -- and more. A look at Harris's stock chart suggests that I was late to the party.

The interesting thing about the denial is that it comes in the wake of reports that Harris had received offers that valued the company at $10 billion -- or $74 a share -- which is less than the $75 to $85 a share it expected. It looks like Harris could be playing a game to encourage a higher bid. I'll keep watching.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.

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