Bellwether Clorox (CLX) is facing trouble on two fronts, The Wall Street Journal reported Monday as the company projected disappointing second quarter earnings. First, the purchase of the personal care unit Burt's Bees did not pan out as expected, forcing the company to writedown between $250 million to $255 million for goodwill on a purchase of $925 million.

Next, the recession is taking its toll. Consumers are extremely cost conscious and are turning to discount brands. Standard Clorox brands, such as disinfectants, bleach and Fresh Step and Scoop Away cat litter, have experienced weakness.

We have been talking a lot about the weak housing market lately, and this morning we get another sign of just how bad things are with luxury home builder Toll Brothers (NYSE: TOL) warning it will see a huge decrease in its quarterly revenues.

The Pennsylvania-based home builder has not yet released official numbers, but will be hosting a quarterly outlook conference call today at 2:00 PM EDT about the fiscal third quarter ended July 31.

The company, which reports earnings August 22, expects revenue to fall 21 percent to about $1.21 billion based on preliminary estimates. Toll also said it wasn't comfortable giving earnings guidance.

This can't be a good sign.

Not only is the company preparing investors for a weak fiscal third quarter, it also is setting the stage for more weakness in future quarters. In this morning's announcement, Chief Executive Robert Toll said that uncertainties in the mortgage market right now could continue to lower the pace of home sales moving forward.

Surprisingly, the stock is trading higher in pre-market trading, but I would not be surprised to see this reverse once the market opens up and Wall Street's big boys get into the action.

Michael Fowlkes has worked as a stock trader for seven years and spent the last two years working as an analyst for the online investment advisory service Investor's Observer.

Stocks To Sell is an occasional column analyzing market trends and highlighting equities investors might want to avoid for now.

Stocks often get hammered after reporting weak earnings. But often the worst carnage comes during the weeks leading up to earnings season -- the period of time we're in now. That's when companies get their first inklings that they may not meet Wall Street targets and have no choice but to go public with that information. Inevitably, the stock gets slammed on the Street's reaction to such negative surprises.

Warnings often hit whole sectors. It may sound lame (and often is) when companies blame their weakness on external events like the weather or economic conditions. But such excuses can also be quite legitimate. The following are some trends that could (or already have) trigger earnings warnings in certain sectors -- and some stocks you might need to worry about:

Dining slump: On June 21, Cheesecake Factory Inc (NASDAQ: CAKE) warned that higher costs and and industry softness would mean its second quarter growth would not be as high as forecast. Analysts downgraded the shares and the stock fell 7% that day to $24.85. Analysts think the company is well-run, but say higher gas prices have hurt restaurants and higher food costs, including dairy costs, have hurt profit margins. Starbucks Corp. (NASDAQ: SBUX), too, faces higher costs and continues to slide, especially after the CFO commented recently that it would be hard for the company to meet its 2007 earnings targets.