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AFTER HOUR ACTION: BIDU
On Tuesday, shares of Baidu climbed in extended trade after the company said it nearly doubled its revenue in the fourth quarter, and forecast first-quarter revenue that surpassed Wall Street estimates.
Looking at the numbers, the search giant said it expected revenue for the first quarter to come in between $360.6 million and $371.2 million, ahead of the average analyst forecast for $354.2 million.
Baidu's fourth-quarter net income rose to $175.9 million, or 50 cents a share, from $62.7 million, or $1.80 a share, a year ago, before a 10-for-1 stock split. That beat analysts' average forecast of EPS of 45 cents.
Revenue in the fourth quarter totaled $371.3 million compared with $184.7 million a year ago. Analysts, on average, had expected revenue of $360.3 million, according to Thomson Reuters I/B/E/S.
What’s the trade?
It’s currently trading at 45 times, but that has seemed expensive for quite a while, says Guy Adami. There’s plenty of growth in this name to come.
If you must play this stock I think you need to buy and hold it, says Zach Karabell. The valuations are stretched but they’re no more stretched than the cloud stocks and Baidu does have a very strong presence in a rapidly expanding market.
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ALPHA NATURAL RESOURCES - BIG DEAL
Energy traders are chattering about the latest big deal in the space. Over the week-end, Alpha Natural Resources agreed to acquire Massey Energy for a approximately $69.33 a share. That represents a 21 percent premium over Massey's closing share price of $57.23 on Friday.
In the wake of the news, shares of rival coal mining companies rose on speculation of a wave of consolidation in the industry.
What’s the trade?
In the space, I’d look at Peabody, says Joe Terranova. I know valuations are rich but I think there’s room to run. The deal highlights just how important their resources are.
The news makes me bullish on investment banks, says Steve Cortes. I think it’s very good for the future of deal flow.
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EAR TO THE WALL: BP DIVIDEND?
The traders suggests watching BP after reports suggested the oil giant may return to a dividend payout as a part of its earnings statement out on Tuesday.
Should you buy here?
It appears troubles for BP are in their rear view mirror, says Guy Adami. Looking at valuations I think the stock is attractive.
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Trader disclosure: On Jan. 31, 2011, 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); Adami Owns (C); Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Adami's wife works for (MRK); Cortes owns (PM); Cortes owns (MO); Cortes owns (EXC); Cortes owns (MS); Cortes owns (GS); Cortes is long U.S. Treasuries; Cortes owns (TSN); Cortes is short (LVS); Cortes is short (BAC); Terranova Owns (VRTS); Terranova Owns (C); Terranova Owns (UPL); Terranova Owns (GM); Terranova Owns (PEP); Terranova Owns (MS); Terranova Owns (POT); Terranova Owns (LTD); Terranova Owns (SU); Terranova Owns (CVI); Terranova Owns (CVE); Terranova Owns (CPX); Terranova Owns (CNQ)
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BRIAN KELLY
Accounts Managed by Kanundrum Capital Own (BAC)
Accounts Managed by Kanundrum Capital Own The Yen
Accounts Managed by Kanundrum Capital Own (TLT)
Accounts Managed by Kanundrum Capital Own (SDS)
Accounts Managed by Kanundrum Capital Own (MON)
Accounts Managed by Kanundrum Capital Own (DBA)
Accounts Managed by Kanundrum Capital Own (JJG)
Accounts Managed by Kanundrum Capital Own (DO)
Accounts Managed by Kanundrum Capital Own (RDC)
Accounts Managed by Kanundrum Capital Own (ATW)
Accounts Managed by Kanundrum Capital Are Short Australian Dollar
JOE TERRANOVA
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
Virtus Investment Partners Owns More Than 1% Of (ABAX)
Virtus Investment Partners Owns More Than 1% Of (AMKR)
Virtus Investment Partners Owns More Than 1% Of (CCG)
Virtus Investment Partners Owns More Than 1% Of (CASS)
Virtus Investment Partners Owns More Than 1% Of (CSVI)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (FCFS)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (KRC)
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Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLB)
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Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
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Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (SUBK)
Virtus Investment Partners Owns More Than 1% Of (WDFC)
Virtus Investment Partners Owns More Than 1% Of (YDNT)
Virtus Investment Partners Owns More Than 1% Of (CLB)
ZACHARY KARABELL
River Twice Capital is short (HAL)
Karabell Owns (RIMM)
DENNIS GARTMAN
Funds managed by Dennis Gartman are long Gold
Funds managed by Dennis Gartman are short Yen
Funds managed by Dennis Gartman are short Euro
Funds managed by Dennis Gartman are short Sterling
Funds managed by Dennis Gartman are long Corn
Funds managed by Dennis Gartman are long Nat Gas
Funds managed by Dennis Gartman are long Swiss Franc
Funds managed by Dennis Gartman are long Canadian Dollars
Funds managed by Dennis Gartman are long Australian Dollars
Funds managed by Dennis Gartman are long Wheat
Funds managed by Dennis Gartman are long Crude
Funds managed by Dennis Gartman are long Soybeans
CRAIG BERGER HALFTIME PLAY OF THE DAY
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FAST 360
DAVID CAMPBELL, SCOTT NATIONS, CARTER WORTH
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DAVID RIEDEL
Riedel has no disclosures
REBECCA PATTERSON
Patterson has no disclosures
PETE NAJARIAN
Pete Najarian owns (CNI)
MIKE KHOUW
Cantor Fitzgerald & Co is a market maker in (PCX)
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