Alcoa Inc. (NYSE: AA) kicks off the new earnings seasons when it reports third quarter results on Tuesday. The Pittsburgh-based aluminum producer, which celebrated its 120th anniversary with the launch of its website, is expected to post a profit of 54 cents per share, down 15.6% from the same quarter of last year, on revenue of $7.2 billion, down 2.1%. While Alcoa has tended to fall short of estimates in recent quarters, in the second quarter it did offer a positive surprise of almost 3%. Its long-term earnings per share growth forecast is 14.8%, a little less than the S&P 500, and analysts polled by Thomson Financial on average recommend buying Alcoa, and have for more than 90 days. Shares reached a new 52-week low last week, and are down 48.9% from a year ago.

General Electric Co. (NYSE: GE) is also expected to report a slip in earnings this week. Analysts anticipate that the conglomerate will post a third-quarter profit of 45 cents per share, down just 6.3% from a year ago, on revenue of $47.7 billion, which is up 12.1%. GE has tended to eke out small positive surprises in recent quarters, by less than 1% in the second quarter. GE's long-term earnings per share growth forecast is only 11.0%, which is less than the sector average and the S&P 500. The consensus recommendation has recently swung to hold GE, but Warren Buffett has bought in to the tune of $3 billion. GE also reached a new 52-week low last week as the markets tumbled. GE shares are down 48.1% from a year ago.

MOST NOTEWORTHY: Lululemon, NaviSite, Research in Motion, Palm and Motorola were today's noteworthy initiations:

• Lululemon Athletica (NASDAQ: LULU) was initiated with a Neutral rating and $42 target at Credit Suisse on valuation.
• NaviSite Inc (NASDAQ: NAVI) was initiated with a Buy rating at Merriman after reporting solid Q4 results. Merriman expects the company's recent acquisitions to significantly increase margins.
  
• Citigroup believes Research in Motion Limited (NASDAQ: RIMM) is not a pure momentum stock as fundamentals are driving share appreciation. They think the company's subscriber growth is beginning to hit critical mass and expect 15M subscribers within 12 months. The firm started shares with a Buy rating and $115 target.
  
• Citigroup also initiated shares of Palm Inc (NASDAQ: PALM) with a Sell rating and $13.50 target, expecting the company's market share losses to continue to EPS to decline.
  
• Citigroup started Motorola Inc (NYSE: MOT) with a Hold rating and $20 target, as they believe its recovery may take longer than expected, noting its new silicon platform does not come out until 2H08.

OTHER INITIATIONS:

• Banc of America initiated On Semiconductor (NASDAQ: ONNN), Mettler-Toledo International Inc (NYSE: MTD) and Thermo Fisher Scientific Inc (NYSE: TMO) with Buy ratings and a $16 target, $120 target and $65 target.
  
• Deutsche Bank started GSI Commerce Inc (NASDAQ: GSIC) and Universal Electronics (NASDAQ: UEIC) with Buy ratings and targets of $52 and $31, respectively.
  
• RBC Capital Markets resumed coverage of Whole Foods Market Inc (NASDAQ: WFMI) with an Outperform rating and $55 target.

MOST NOTEWORTHY: The cable and satellite sector, Wal-Mart Stores (WMT) and Motorola (MOT) were today's noteworthy upgrades:

• Credit Suisse upgraded the cable and satellite sector to Market Weight based on cable's solid long-term strategic position, attractive valuations and expectations that new industry that new industry consolidation will continue. Additionally, the firm upgraded Mediacom Communications Corp (NASDAQ: MCCC) to Outperform from Market Perform and Charter Communications (NASDAQ: CHTR) to Outperform from Underperform.
• Wal-Mart Stores Inc. (NYSE: WMT) was upgraded to Overweight from Neutral at JP Morgan, as the firm believes the company has reached an inflection point following the company's plans to cut capital expenditure by around $2.5B and return $15B to shareholders through a buyback program. Wachovia upgraded shares of Wal-Mart to Outperform from Market Perform citing management's plans to slow U.S. store growth, reduce cap-ex and increase share buybacks. Morgan Stanley upgraded Wal-Mart to Overweight from Equal Weight and to Overweight from Neutral at HSBC.
  
• Motorola Inc. (NYSE: MOT) was upgraded to Sector Outperformer from Sector Performer at CIBC World Markets to reflect optimism on the company's product portfolio and margin progress. They believe the company's focus on margins and not share should lead to a higher long-term margin model.

OTHER UPGRADES:

• Bear Stearns upgraded Sirius Satellite Radio Inc. (NASDAQ: SIRI) to Outperform from Peer Perform, citing attractive risk/reward, shares of Universal Health Services Inc. (NYSE: UHS) to Peer Perform from Underperform based on expected near-term upside to estimates and Onyx Pharmaceuticals Inc. (NASDAQ: ONXX) to Outperform from Peer Perform.
• Merrill Lynch upgraded shares of Moody's Corp. (NYSE: MCO) to Neutral from Sell and shares of Mobile TeleSystems (NYSE: MBT) to Buy from Neutral.
• Thomas Weisel upgraded shares of NaviSite Inc. (NASDAQ: NAVI) to Overweight from Neutral citing valuation.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

MOST NOTEWORTHY: Broadcom Corp (BRCM) and American Medical Systems Holdings (AMMD) were today's notable initiations.

• Merrill Lynch reinstated Broadcom Corp (NASDAQ: BRCM) with a Buy rating and $42 target to reflect the company's secular growth story.

• Thomas Weisel started American Medical Systems Holdings (NASDAQ: AMMD) with an Overweight rating and $16 target; the firm says American Medical is a leader in surgical urology and gynecology and sees upside from the company's full pipeline.

OTHER INITIATIONS:

• NaviSite inc (NASDAQ: NAVI) was initiated with a Market Weight rating at Thomas Weisel.

• Medicis Pharmaceutical Corp (NYSE: MRX) was initiated with a Buy rating and $45 target at Jefferies.

• Soleil initiated Amylin Pharmaceuticals Inc (NASDAQ: AMLN) with a Hold rating.

• DA Davidson started Allegheny Technologies Inc (NYSE: ATI) with a Buy rating.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).