Considering shares of Intel are down about 9% over the past three months, how should game the stock ahead of earnings Tuesday?
Seems like a good time for Fast Money 360.
Find out what fundamentals, technicals and insights from the options world all suggest lie ahead for this stock!
FUNDAMENTALS
FBR analyst Craig Berger thinks the Street is underestimating chip maker Intel. He tells Fast Money, “into earnings, Intel is likely a ‘Buy’ because we expect in-line 3rd quarter guidance while the Street expects a guidance miss.”
Although many investors are turning their back on this stock fearing a weak consumer equals weak computer sales, there might be more to this story.
”It's (also) a flight to quality name,” Berger explains, “with a lot of cash and a dividend.
”People can hide out in this stock and expect in line news which should be good enough,” he concludes.
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CHARTS
Technical analysis from Carter Worth of Oppenheimer is also largely bullish.
Looking at the charts Worth tells us, “Intel has sold off to a level where the potential for a rebound is high.”
Going forward, Worth suggests the stock presents an attractive risk / reward ratio. “It's a nice set up going into earnings for a buyer,” he counsels.
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OPTIONS
Pete Najarian of Optionmonster.com tells the desk that options are “exploding” suggesting investors are betting on a big move post earnings.
And, at a ratio of 3 calls trading for every 1 put, Najarian interprets the action to mean “people are expecting a bullish report.”
Considering the fundamental and technical analysis as well as the options action, ”I’d be a buyer of Intel at these levels,” he concludes.
What’s the take away?
Intel has come down into earnings, says Brian Kelly. If Intel is forming a base I think it’s a good place to be.
If you're as bullish as the guys above, consider buying a call into the numbers, adds Tim Seymour. That may be the way to play it because in the past Intel has burned.
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Trader disclosure: On July 12, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Finerman's Firm Is Short (IJR); Finerman's Firm Is Short (MDY); Finerman's Firm Is Short (IWM); Finerman's Firm Is Short (SPY); Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Leap; Finerman Owns (BAC), (BAC) Preferred; Finerman Owns (GOOG); Finerman's Firm And Finerman Own (HPQ); Finerman's Firm Owns (JPM), (JPM) Leap; Finerman Owns (JPM)l Finerman Owns (WFC) Preferred; Finerman's Firm And Finerman Own (BBY); Terranova owns (GOOG), (AMZN), (MON), (APC), (GMCR), (MYL), (MRVL), (BAC), (ADI), (ADBE), (AKAM), (HES), (CVS), (AXP), (EMC), (ABT); Kelly Is Short (GS); Kelly Owns (BP) Puts; Najarian Owns (INTC) Call Spreads
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