Starbucks stock retreated in heavy volume after a report suggested the coffee chain's growth may be losing some steam.» Read More
Despite consumers cutting back spending, Christine Chen, vice president of equity research at Needham & Company, still feels bullish about the back-to-school retail industry.
“We like the names that have done well in the first half of the year, have the fashion product, and will actually get the consumer to spend their dollars,” she said.
Aeropostale -– “They have consistently beaten numbers and raised guidance. In a year from now, our price target is $38 -– a 20 percent gain. I think when they report earnings at the end of August or beginning of September, they’ll beat expectations and continue to show that their sales trends are still growing.”
Guess -– “I think a lot of investors miss the fact that they have 30 percent of their business in Europe, and their European business is very strong. They’re at their early stages there and continuing to gain market share there as well as domestically in the U.S.”
Urban Outfitters -– “Nobody else has products like them. Nobody else has stores like them. They are one of few names where estimates will probably continue to go up during the year, because they have the right product and consumers are paying full price for it.”
It would have been hard to miss the 30-plus percent pop in shares of Wells Fargo today—an astonishing rebound that added $22 billion dollars in market value to the beleagured bank. (Yet the jump only left it about where it was trading in mid-June!)
But what might have escaped your probing eyes today were the crazy gains made in the options market; specifically, Wells Fargo Calls.
For example, the July '08 $25.00 contract rose more than 2000 percent going from $0.10 to $2.25 on volume of 37,000 contracts as of this writing.
Further out, the August $27.50s also soared, going from $0.15 to $1.55 for a nice 933% one-day gain!
Same for the October '08 and January '09 strike prices from $25 to $35, which gained anywhere from 100 to 300 percent today.
Crazy money ... if you're crazy enough to chase it.
More CNBC options chatter:
Have the stock markets bottomed?
J.J. Burns of JJ Burns & Company joined Bill Seidman and Bob Pisani to lay out the facts.
More CNBC Intelligence:
John Faucher says there's still room for a portfolio to grow in beverages and personal care.
The JPMorgan senior analyst favors companies with significant international exposure -- but he has his reservations about bottlers.
"The highly-profitable convenience- and gas-store volume -- those 20-ounce bottles you see out there -- those are down, because people are spending more money on gas," he told CNBC.
So what names does he like?
"Right now, we still think some of the bigger, multinational names that are still putting up teens earnings growth -- a Colgate, a Pepsi, a Coke (Coca-Cola) -- the valuations, again, are at 15- to 20-year lows right now, solid dividend yields, good visibility...volatility surrounding some emerging markets, but at these prices, we think it's more than priced in," he said.
Looking for a good stock investment? Jay Bowen of Bowen, Haines & Co. says you should seek out companies that would benefit from falling raw-materials and oil prices.
"Several industries have been faced with rising raw material costs, because of the over 100 percent increase in oil over the last year," Bowen told CNBC. "I think it's a constructive time to ask, 'What industries are going to benefit if that becomes a tailwind instead of a headwind?' The diversified chemical industry would certainly qualify."
At the top of that list is DuPont.
"They've got their traditional chemical businesses, but also are involved in some very interesting growth areas," he said. "They continue to transform from a traditional chemical company to more of a high-tech science-oriented company; they're involved in agriculture and biotechnology."
He recommends BASF in the diversified chemical space -- and also recommends drug retailer Walgreen because of its historically low valuation.
Options traffic is swirling about possible generic drug merger, auto-related stocks, and a cruise line, Rebecca Darst of Interactive Brokers reported on CNBC's "Squawk Box" Thursday.
Options were active just before reports drifted out of Israel media that there may be a possible $7.5 billion merger between generic drug giants Barr Pharmaceutical , based in New Jersey, and Israel-based Teva Pharmaceutical. (See her full comments in the video).
Looking for a big move today in Microsoft stock ahead of its earnings? The options say "Don't count on it."
Dow Chemical is buying Rohm & Haas for $18.8 billion. Who are the biggest winners and losers?
Clearly the biggest winner is the Haas Family Trusts and their 33% stake -- which has instantly gone from a 22-month low to an all-time high.
After that, the latest federal filings show Boston-based Evergreen Investment owns about 29%, followed by an 11% stake held by Los Angeles-based Capital Group, which runs the American family of funds.
Two-thirds of the 18 analysts who covered the stock rated ROH a "hold," with Citigroup most recently cutting its recommendation to "sell" on July 1. There are 5 "buy" ratings on the stock.
As is the case with any takeover that has a huge premium, a scramble of ''relative valuation'' typically ensues, as investors say if ROH is worth "X," than my specialty chemical maker has to be worth "Y."
There are a dozen large cap "Specialty Chemical" names in the Russell 1000, including:
Albemarle, Valspar, Sigma-Aldrich -- and even International Flavors & Fragrances is considered a spec chem.
If they recommend financial stocks at all, most experts are aiming at the top of the sector, at banks that have managed to escape the subprime meltdown. Formula Capital's James Altucher has been working the other end.