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Market Preview: A Warning Signal

" W ith the shares up 20%+ since reporting in late August and its P/E and EBITDA multiples now trading at a premium to 2-year averages, we think some of this outperformance is priced in," UBS said. "The company has the momentum at its side, but would we be more judicious with timing a buying opportunity."

Arguing that the shares have priced in "a beat and a raise," UBS said Williams-Sonoma has to, at the very least, add any upside in the third quarter to its full-year forecast.

"The outlook for the holidays will gain more credibility if WSM was able to generate a nice WS brand comp in 3Q (we are modeling a 1% increase)," the firm added. The shares closed Tuesday at $46.05, up nearly 20% so far in 2012.

Also slated to report on Wednessday are Abercrombie & Fitch (ANF), AGCO Corp. (AG), Bluegreen Corp. (BXG), DryShips (DRYS), FriendFinder Networks (FFN), Hot Topic (HOTT), Limited Brands (LTD), Millipore (MIL), NetApp (NTAP), New Frontier Media (NOOF), Petsmart (PETM), Retalix (RTLX), Spectrum Brands (SPB), Tyco International (TYC), and

Wednesday's economic calendar is pretty packed with the Mortgage Bankers Association's weekly mortgage application activity index at 7 a.m. ET; retail sales for October at 8:30 a.m. ET; the producer price index for October at 8:30 a.m. ET; business inventories for September at 10 a.m. ET; and the release of the minutes of the Oct. 23-24 policy meeting of the Federal Open Market Committee at 2 p.m. ET.

Jim O'Sullivan, chief U.S. economist at High Frequency Economics, expects the impact of Hurricane Sandy to start to show up in the data this week, specifically in tomorrow's retail sales number as well as initial jobless claims on Thursday.

"While we expect the net impact on Q4 GDP to be modest, some of the monthly and weekly data could be affected significantly, with extra weakness at the start of the quarter followed by catch-up later," he said. "The main candidates for a noticeable impact this week are retail sales and jobless claims -- with retail sales down and jobless claims up."

And finally, Cisco (CSCO - Get Report) shares were surging in late trades after the Dow component topped Wall Street's expectations for its latest quarter on both the top and bottom lines.

The networking giant reported non-GAAP earnings of $2.57 billion, or 48 cents a share, on revenue of $11.88 billion, up from a year-ago equivalent profit of $2.32 billion, or 43 cents a share, on revenue of $11.27 billion.

The performance topped the average estimate of analysts polled by Thomson Reuters for earnings of 46 cents per share on revenue of $11.77 billion. On CNBC, CEO John Chambers said the company's gross margin came in at 62.7% for the quarter. The stock was last quoted at $18.10, up 7.42%, on extended volume of 12.24 million, according to

-- Written by Michael Baron in New York.

>To contact the writer of this article, click here: Michael Baron.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.
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CSCO $29.51 0.00%
SPLS $16.76 0.00%
WSM $80.45 0.00%
AAPL $128.46 0.00%
FB $78.97 0.00%


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