As for Tuesday's scheduled news, Home Depot (HD - Get Report) is slated to report its third-quarter results before the opening bell. The average estimate of analysts polled by Thomson Reuters is for earnings of 70 cents a share from the Atlanta-based home improvement products retailer on revenue of $17.92 billion.
Shares of Home Depot closed Monday at $61.16, up nearly 60% in the past year. Credit Suisse, though, sees the potential for further upside from here.
"We continue to want to be most exposed to housing, followed by good companies with easy compares," said the firm, which doesn't necessarily expect a blowout quarter though from Home Depot, which has topped Wall Street's profit expectations in seven of the past quarters.
Cisco (CSCO - Get Report) is the big earnings report after the close. Wall Street is looking for a profit of 46 cents a share on revenue of $11.78 billion in the networking giant's fiscal first quarter ended in October.The stock has fallen more than 10% in the past year and trades at a relatively cheap forward price-to-earnings ratio of 8.1X vs. 13.4X for the S&P 500 as of Friday's close. Shares closed Monday at $16.85. Credit Suisse reiterated an outperform rating on the stock on Monday with a price target of $25 ahead of tomorrow's print. Based on how earnings season has progressed so far, the firm is anticipating "soft" results from Cisco but it believes this scenario is already priced into the shares. "While we expect near-term operating weakness related to the macroeconomic environment, we reiterate our Outperform rating and continue to see favorable risk-reward for CSCO's shares," the firm said. "CSCO appears to be embracing its evolution from a 'growth' to a 'value' company, with a corresponding shift in focus to earnings and cash flows. This commitment together with a greater than 3% div. yield and greater than 10% FCF