Halftime Pt. 2: Who Would Buy BP?
In a note circulated Tuesday, JPMorgan Chase laid out "fantasy" M&A options for BP , naming Exxon Mobil or Royal Dutch Shell as potential buyers.
"BP is not Lehman Brothers," says Joe Terranova of Virtus Investment Partners. "They have tremendous global assets."
Terranova says he could see Exxon, Shell or even ConocoPhillips moving on BP. Whoever has the best balance sheet will make the play, he says.
But when are they going to buy, asked Brian Kelly of Kanundrum Capital. If the relief well doesn't work, BP has "big problems." So he wonders if a company would move in and buy before or after a bankruptcy claim.
CALL TO THE FLOOR: COGNIZANT TECHNOLOGY
With the NASDAQ down more than 5% year-to-date, one large cap tech stock has been nearing all-time highs and maintaining 20% annual growth: Cognizant Technology .
The Teaneck, N.J.-based company provides IT outsourcing services around the world. CEO Francisco D'Souza stopped by the Fast Money Halftime Report Tuesday to talk with the desk about the company's outlook. He says economic volatility creates demand for CTSH's services. Companies are less likely to hire, so they outsource. At the same time, managers are more prudent and that plays to Cognizant's stregth, as well.
D'Souza says there has been a pick-up in demand from North America and sees continued stregth in Asia. Europe, however, has remained flat. Eightteen percent of Cognizant's revenues are from Europe, but most transactions use the US dollar, so D'Souza says exposure to the euro is limited.
Host Melissa Lee pointed out that Cognizant recently gave its employees a raise. D'Souza says the company is able to do that because it has a non-gap operating margin that ranging 19-20%.
What's the Trade?
Jon Najarian of optionMONSTER.com likes Cognizant Technology, but considering its stock is trading at around $50, he's not yet ready to pull the trigger.
CALL THE CLOSE
"I think you just sit on your hands now," says Joe Terranova of Virtus Investment Partners.
Patty Edwards of Storehouse Partners is "watching from the sidelines."
"Sell them," says Brian Kelly of Kanundrum Capital.
"I'm getting ready to get long if we hold 1040," says Jon Najarian of optionMONSTER.com.
Got something to to say? Send us an e-mail at email@example.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to firstname.lastname@example.org.
CNBC.com with wires