At best it was a week that was difficult; at worst it was a very concerning sign about what is to come. We have finally seen a significant drop in the overall sentiment due to extraordinarily high oil prices mixed with an unemployment level at 5.5%. The mixture of these and other troubling economic projections has finally come to cause investors to pause and realize that this is no place to be accepting risk beyond what is absolutely necessary.

This week will show a significant amount of reservation by investors not accepting of any shortfalls on earnings or even outlooks that are not significantly rosy. The current picture and the economic outlook was the focus of The Disciplined Investor Podcast this week, with help from money manager and economist, Michael "Mish" Sheldock.

Monday, June 9

Shuffle Master Inc. (NASDAQ: SHFL) will be reporting earnings that are expected to be $.07 per share. This has continued to be a difficult market for them even as casino construction has been rising around the world and the use of many of the products of this company are beneficial to the net profits of their customers. The stock has suffered dramatically over the past 12 months and, unless there is a product shift or new technology announced, there should be no reason that we see a catalyst for growth. Look for revenues of $45.55 million.

Ashworth Inc. (NASDAQ: ASHW) is a high-brow retailer that is expected to show a significant turn toward the negative this quarter. First Call estimates are looking for a negative $.06 per share while a year ago they were earning $.03 per share. Once again, there doesn't seem to be any reason why this company should see a beneficial upside unless investors are willing to short cover at this point. Even if that is the case, that will probably end up being temporary anyway.

Tuesday, June 10

As we continue to see erosion in almost every earnings announcement and projection with in the retail sector, Pep Boys (NYSE: PBY) will be coming out with earnings, estimated to be a $.03 per share loss on $497 million of revenue. This company operates 552 supercenters along with 9 express stores in 35 states. 118 of the stores are located in California, which has been one of the hardest hit areas during this economic downturn. The shares have been reflecting a significant problem with earnings as they are down over 60% in the past 12 months. In January, February and March shares have been consolidating toward the support level of $8.25. If earnings come in light or revenues are not up to expectations, there will be an immediate drive down below that level, and investors should be very observant of the trend. The bottom line: This company is in the wrong sector, in the wrong economy, and has too much of a reliance on one geographic area.

One bright light for the week may be seen with Quality Systems (NASDAQ: QSII). Shares have been holding up well over the past six months, and while there was a significant drop in November, the longer-term trend has been up. The technical signs are positive, as the stock has been consolidating and trapped in a range between $30 and $35. As there is a need for cost-cutting and efficiency within the medical and dental fields, Quality Systems provides practice an electronic record management software to help find efficiencies. With low debt and even a small dividend, this company's earnings have been relatively stable, and as estimates call for $.56 per share (a 50% reduction from the year ago period), if investors are looking to put their money in a position that may hold long-term value this could be a good play. Also take a look at the fact that short interest is high and showing 25 days to cover. If earnings hit well, there will be a significant short interest cover towards $42.

Wednesday, June 11

Korn Ferry International (NYSE: KFY) is involved in the recruiting service is for various industries and has 82 offices in 39 countries. If we consider a global economic slowdown, we also have to consider the fact that hiring will either be slowing or in some cases frozen. Earnings have been declining and projections of $.36 per share on $210 million of revenue are probably high. While the fundamentals for the stock look healthy, the overriding reality is that it will be difficult to add revenues as customer orders and requirements for new hires will be dropping precipitously.

Cyberonics Inc. (NASDAQ: CYBX) shares have been up sharply since March as there is renewed excitement around their implantable devices to treat epilepsy, depression, and other neurological and psychiatric diseases. The company is still burning through assets as they have not been profitable. There has also been significant concern over the effectiveness of the device. The company has been upgraded recently, and whether this is a false bounce or something to take notice of will be seen in next earnings statement and by management's projections. If they meet estimates, this will be the first time since 2004 that they did not report a loss. First Call is showing earnings of $.00 per share on a paltry $31 million of revenue.

Thursday, June 12

All eyes will be on Lehman Brothers Holding Inc. (NYSE: LEH) as they are due to report earnings. Analysts are expecting a loss of $.22 a share on $2.6 billion in revenue. There has been some scuttle about the desire of the company's board to move earnings up earlier, which has a lot of investors wondering why there is such a rush. It stands to reason that if earnings are pushed forward, Lehman may include an announcement of an additional share offering to bring in additional funds that they desperately need to continue operations. It stands to reason that by pushing the earnings day forward they may get all the bad news out in one tidy package. Whether or not they report today is really of no consequence as there will be huge volatility. Big bets are being laid on both sides of the field. If you are a trader, have a good time as this should be fun.

China Medical Technologies Inc. (NASDAQ: CMED) develops high-intensity focused ultrasound products to treat solid cancers and benign tumors. In early April, the company launched a device that helps detect prostate cancer in its early stages. Shares quickly doubled and have since settled back toward the range of $34-$38. Earnings have been growing steadily, yet over the past few months we have seen a tapering off and the share price is now reflective of forward concerns by investors. Earnings estimates call for $.44 a share and $37 million of revenue, and while the company has been mostly higher in this difficult environment, it is has huge debt and its valuation ratios are rather rich. Don't be surprised that if they miss earnings, shares will come down toward the $26 range rather quickly.

Disclosure: Horowitz & Company clients hold positions in some stocks mentioned as of the publish date.

Andrew Horowitz is a money manager and author of The Disciplined Investor: Essential Strategies for Success. Now available on audiobook!