The Word On Buyout Speculation, Consolidation In Steel...
RUMORS GONE WILD
The headline: Of 130 Buyout Rumors Since December, Only 4 Have Panned Out (source: StreetAccount)
The word: Jeff Macke says speculation and rumors are part of the Wall Street game. They always push stocks higher and traders need to be smart enough to separate fact from fiction.
PEDAL TO THE METAL:
- Alcoa (AA) , AK Steel (AKS) Buyout Speculation Fueling Red-Hot Metals Trade
- Steelmaker Arcelor Mittal (MT) May Make $4.5B Bid For AK Steel, FT Reports.
- Alcoa Makes $26.9B Bid For Alcan(AL) But May Too Be Bought
The word: Eric Bolling says consolidation in the space is a big trend right now and he expects it to continue. Guy Adami recommends investors own Commercial Metals Company (CMC) on a dip, because it stands to benefit from the boom in non-residential building.
THE WONDERFUL EARNINGS OF DISNEY:
The headline: Walt Disney (DIS) Profit Rises As `Wild Hogs', TV Advertising Drives Earnings
The word: Jeff Macke says DIS had a great quarter and thinks this stock will continue to climb. He was particularly happy to hear that theme park attendance was up nearly everywhere.
TESORO TRADE UPDATE
The Headline: Last Week Eric Bolling Recommends Buying Puts On Tesoro
The word: Eric sold those 120-puts today. Now, he recommends buying TSO shares on the dip.
A BUFFETT BUY?
A Viewer Says Tyco (TYC) Would Be An Ideal Buyout Target For Warren Buffett
Jason from Ohio writes “I think Buffett would pay over $60B and buy Tyco (TYC). It has everything, including a $40 per share break-up value! It has Buffett written all over it.”
The word: Guy Adami says TYC should be a $41 stock. (It closed at $32.05 on Tuesday.) He thinks if the company spins off business units, the stock will do better.
RIMM SHARES IN MOTION:
The headline: Research In Motion (RIMM) Shares Surge As Analysts See Healthy Growth
The word: Eric Bolling explains Karl Icahn doesn't have enough votes to obtain a seat on the board of Motorola (MOT), and that translates into upside for RIMM. (In other words, investors believed that Icahn would have benefited MOT so much, they stayed away from RIMM, until they had a better idea of what was going to happen.)
IT'S ALL ABOUT THE COLOGNE:
The headline: P. Diddy's "Unforgivable" -- Distributed By Estee Lauder (EL) – Becomes Top-Selling Men's Fragrance
The word: Jeff Macke says despite the success of this cologne, investors should not buy stock in Estee Lauder. They missed earnings by “a country mile.”
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Trader disclosure: On May 8, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders Macke Owns (JWN); Bolling Owns (DIS), Gold, Silver; Bolling Is Short Nasdaq Futures, Bolling Closed Out His Tesoro Put Trade; CNBC Is A Service Of NBC Universal And Dow Jones