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The headline: Activist Investor Carl Icahn May Launch Proxy Fight with Yahoo [YHOO
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]: CNBC’s Faber
Billionaire investor Carl Icahn is considering launching a proxy fight at Yahoo, according to people who have spoken with Icahn.
Late last week, Icahn began building a significant position in Yahoo that may be as much as 50 million shares, these sources said.
Although other activist investors had considered mounting a fight to replace all of Yahoo's board, they stood down from that effort when they were unable to get any sense from Microsoft that it would support them.
Icahn is the man for the job, according to Karen Finerman. Whether or not Icahn succeeds in a proxy fight depends on whether he can get other big shareholders on board. This is pure “Carl 101,” she said. But there isn’t a lot of time. Icahn has until Thursday night to file his intentions.
Jeff Macke isn’t willing to buy YHOO if Icahn gets involved, but it certainly makes the story more interesting, he said.
Why not just stick with Google [GOOG
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], which has been working? That’s how Guy Adami is trading this drama. On a valuation basis, GOOG is still cheaper than YHOO, he said.
WAL-MART ROLLS BACK
The headline: Wal-Mart [WMT
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] Earnings Top Estimates, But Shares Fall on Cautious Outlook
Jeff Macke is a buyer of WMT on any dips. The world’s largest retail is no longer complaining about the economy – it’s doing something about it by addressing the needs of its consumers.
‘FAR FROM NORMAL’
The headline: Fed Chairman Bernanke Says Financial Markets Remain ‘Far From Normal’
Pete Najarian actually thinks the perspective from the financial markets is one of a return to normalcy. While volatility remains, it’s way off the highs. Investors look to finally be accepting and looking out beyond the short term, he said.
CRUDE TREND
The headline: Crude Oil Closes Up 1.3% to $125.80; New Record Set on Concerns Over Iranian Output, Weekly U.S. Inventories
The best way to trade commodities is off the charts, Jeff Macke said.
With oil, you can play the uptrend and buy when it’s near the trendline, but that opportunity doesn’t look like it will present itself for a while. So in the meantime, he recommended playing the resistance and support. If you trade within a range, stopping out at levels of resistance and buying when it breaks out, “that’s the winning trade on crude,” he said.
Guy Adami recommended playing this story with oil services giants like Halliburton [HAL
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], which just touched a new 52-week high on its international business.
Pete Najarian prefers the oil services ETF [OIH
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], which gives exposure to the broader sector. And don’t forget about natural gas, he said, which looks like it’s about to break out as Occidental [OXY
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] and Chesapeake [CHK
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] hit new highs. You can’t fight the energy trade, he said.
AFTER HOURS ACTION: APPLIED MATERIALS
The headline: AMAT [AMAT
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] CEO Sees Orders Down 15-20% This Quarter
Despite some cautious words from the CEO, Pete Najarian thinks the story with AMAT is its growing solar business.
Guy Adami agreed. This stock should be worth $25, he said.
AFTER HOURS ACTION: ELECTRONIC ARTS
The headline: ERTS’ [ERTS
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] Profit Beats Expectations But Shares Fall
The stock is rolling over after hours because investors are probably realizing that ERTS doesn’t have a plan, Jeff Macke said. Without a better pipeline, it’s not worth buying. Activision [ATVI
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] is a better play to Macke.
AFTER HOURS ACTION: WHOLE FOODS
The headline: WFMI [WFMI
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] Tumbles After Hours on Weaker-Than-Expected Earnings, Sales
This economy is not conducive to the organics business, Jeff Macke said. Whole Foods is yesterday’s news.
LIZ CLAIBORNE REBORN?
The headline: Shares of Liz Claiborne [LIZ
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] Trade Up Despite Posting a Loss, Cutting Forecast
CEO Bill McComb said the stock is starting to work again because the turnaround is working. Since McComb took the helm of the retailer 18 months ago, it has been working on divesting and narrowing its portfolio of brands to focus on growing profitable brands and fixing the shrinking ones, all while managing inventories and cashflow.
Strong brands will win in any economy, according to McComb. That’s why LIZ’s big-ticket brands like Juicy Couture, Kate Spade and Lucky are continuing to see strong sales. Consumers put a premium on those brands, he said, and they continue to be well-loved.
If McCombs’ strategy plays out, it could spell good news for investors of this long-beleaguered retailer.
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Trader disclosure: On May 13, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Najarian Owns (AAPL), (AMAT), (ENER), (NOK), (TSO), (XLF); Najarian Owns (C) Calls, (MSFT) Calls, (YHOO) Calls, (AES) Calls; Macke Owns (WMT), (INTC), (DIS), (EMC), (ATVI), (MSFT), (HAS); Finerman Owns (GS); Finerman's Firm Owns (KSS), (MSFT), (TSO), (VLO), (GLNG); Finerman's Firm Owns (YHOO) Call Spreads; Finerman's Firm Owns SPX Index Puts; Finerman's Firm Owns (C) And (C) Leaps; Finerman's Firm Is Short (IYR), (IJR), (MDY), (IWM), (SPY); GE Is The Parent Company Of CNBC; NBC Universal Is The Parent Company Of CNBC
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