The guys (and gal) go behind the headlines and give you the traders take on the Palm/MOTO disaster... the Blackstone $4 billion IPO... the EU open skies... and more. Find out where they see fast money.
The news: Palm (PALM) reported a 61% drop in its third-quarter profits Thursday as speculation of a buyout continued to swirl.
The word: Jeff Macke thinks this is a disaster for Motorola (MOT). Palm continues to go lower, and they don't look like they're getting any more attractive to Motorola. If the buyout is in the works, Motorola has bigger fish to fry right now and it won't happen soon.
Oil's Slick Comeback:
The news: Crude oil breaks $60 barrier, closing at highest level in 2 weeks.
The word: Eric Bolling says the oil spike today had a couple reasons behind it. The first was that North Korea walked away from talks with the U.S. - and that was being watched very carefully by Japan and China. When North Korea is involved, there is always some geopolitical unrest that affects oil. That accounted for the first dollar of the spike, the second had a little to do with the Fed, he says. There is no evidence of oil coming down anytime soon, and Eric thinks nationwide $3 gas is coming within weeks.
The news: EU approves "open skies" agreement, liberalizing air travel between Europe and U.S.
The word: Guy Adami says this will benefit Boeing (BA). European carriers are already putting in orders, and they will go to Boeing. The company always outperforms in the 3 months leading up to the June air show anyway, and Guy sees it going higher.
Cellar Dweller No More?:
The news: KB Home (KBH) reports 84% plunge in earnings but beats Street estimates.
The word: Karen Finerman sees a potential bottom in the price of homebuilding stocks, but not necessarily the homebuilders themselves. As for KB Home, it produced terrible earnings but its revenues actually weren't bad, she says, nor was its EPS. Cancellation rates were even down from 40 to 31, so while its earnings paint one picture, the rest of its financials paint another. Guy points out that KBH is getting down to 1x book value which is "historically compelling valuation." The worst isn't over, but he thinks it's getting close.
The news: Alon Energy (ALJ), oil refiner and convenience store owner, surgues 6% on upgrade.
The word: Eric Bolling thinks they're firing on all cylinders. Alon makes the most profitable gasoline in country and it has a very high profit margin on its Twinkie brand.
The news: Barnes & Noble (BKS), Borders (BGP) sell off on disappointing earnings.
Bill from Tennesee asks the guys via e-mail: With the first printing of the new Harry Potter book at 12 million, are the book chains a trade around the July release?
The word: Jeff thinks Borders' announcement that it's finally getting rid of Walden books shows that it's on the right track. He sees the company getting bought eventually, and this move shows that it's starting to think like an M&A target should. As for the Harry Potter release, he says wait for the catalyst - that's the anticipation of the release which will be a few weeks before, not a few months.
The news: Private equity giant Blackstone files for $4 billion in IPO.
The word: Karen says if you can buy in at the offering price, then its great. But the average investor can't do that. "Do I really want to be on the other side of the trade...? No."
The news: Saks (SKS) shares jump 4% on upgrade.
The word: Guy called this one. The stock has great margins, he says, and their same store sales are "out of control."
Your Dining Pleasure:
The news: Your text messages tell us that Chipotle (CMG) is your favorite fast food stock.
The word: Jeff says Chipotle is slow money. He doesn't dislike the stock, and he says rising corn prices could be an influence but not necessarily a reason to avoid it. Chipotle just doesn't do it for him. He would rather be in Jack in the Box (JBX) or even Wendy's (WEN) or McDonald's (MCD). Eric points out that the stock does surprisingly well considering the company has "virtually no advertising."