Yahoo, Polls and Cisco Make for an Interesting Week

The Indiana and North Carolina primaries are Tuesday, and Indiana is going to be especially interesting. It's an "open" primary, so Republicans can vote, as well as independents. It's been speculated that Republicans will vote to muddy the water and keep the Democratic struggle ongoing to the convention, giving Senator McCain that much more time to stay above the fray.

Also, polling is difficult since voters don't register by party, but it appears that Senator Clinton has a slight edge. Indiana has a "history of racial tensions and Ku Klux Klan activity, and the Obama candidacy is seen as the one new test of how much attitudes here have changed." (Wall Street Journal, Friday, May 2.)

The re-emergence of Reverend Jeremiah Wright as a campaign issue and Senator Obama's recent remarks about small-town America should make this state a solid win for Sen. Clinton. While the industrial city of Gary is 84% black, most of the state is rural, white, older and lower income. This demographic has been Senator Clinton's strength. That it appears close shows the underlying strength of the Obama campaign, or the negative reaction to Sen. Clinton that she has fought against since announcing her candidacy.

My guess is that Sen. Clinton wins by a small percentage and is deprived of the necessary 10% margin that would allow her campaign to say that Sen. Obama can't carry the traditional Democratic voting bloc. I'm also guessing Sen. Obama wins North Carolina with its goodly proportion of black voters, and it's on to West Virginia and Kentucky for more of the same.

Also, on Tuesday, we will get Cisco's (CSCO - commentary - Cramer's Take) earnings report after the close. Last quarter, CEO John Chambers tempered expectations with a prediction of 10% growth, not the 15% the Street had been hoping for. A 10% increase would yield revenue of $9.75 billion and EPS of $.36 a share. For the July quarter, the Street expects $10.3 billion in revenues and EPS of $.39.

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At the time of publication, Farrell was long Cisco, although positions can change at any time.

Vincent Farrell Jr. is a principal of Scotsman Capital Management. Prior to joining Scotsman in April 2005, Farrell was chairman of Victory Capital Management of Cleveland and chairman of Victory SBSF Capital Management in New York. He was a founding partner of Spears Benzak Salomon & Farrell, which was acquired by KeyCorp in 1995. Vince held a variety of positions in his 23 years at SBSF, including chief investment officer, and he served as the portfolio manager on a number of the firm's largest client relationships. He is a regular guest on CNBC as well as other national print and broadcast media.

Prior to joining SBSF, Vince spent nine years at Smith Barney as a vice president, sales.

Vince graduated from Princeton University in 1969 and received his MBA from the Iona College Graduate School of Business in 1972.