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Halftime: A Pro's Guide to Retail Earnings Next Week

With 13 retailers scheduled to report earnings next week, the "Fast Money" traders on Friday discussed which has pricing power — the ability to pass higher costs onto consumers.

In a note, Morgan Stanley recently said Tiffany & Co. is able to preserve its margins. Stuart Frankel's Steve Grasso agreed, adding that Coach and Abercrombie & Fitch also have pricing power. Abercrombie has become an international play, he said, noting that its Hollister brand is opening stores in China, France, London and Milan, Italy.

International sales, remarked options trader Jon Najarian, is what's giving retailers that added push.

"A lot of smart money is buying into these retail names," Najarian said, noting that renown hedge fund manager David Tepper has been buying retail stocks. "They're doing it because the consumers are feeling a little bit better. Obviously, the higher-end consumers weren't dinged nearly as much and they've continued to spend."

A lot of retailer stocks are up so much, CNBC's Scott Wapner wonders if they can continue to go higher, regardless of pricing power. Grasso said Abercrombie is at the top of its range, so to go higher it needs to continue trading above $57 a share.

Following is a look at what retailers are reporting earnings next week:

Retailers Reporting Earnings
Mon., Feb. 21 —Market Holiday—
Tue., Feb. 22Home Depot, Macy's, Walmart
Wed., Feb. 23TJ Maxx, Lowe's, Saks Fifth Avenue, Limited Brands, Dollar Tree
Thu., Feb. 24Kohl's, Target, Sears, Gap
Fri., Feb. 25J.C. Penney

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SOLAR STOCKS SHINE

By midday trading on Friday, solar stocks topped the tape after SunPower reported better-than-expected earnings results and gave a strong outlook.

Gordon Johnson, an analyst at Axiom Capital, doesn't see a bright future for the solar space, though. While individual solar names are likely to report positive fourth-quarter earnings, Johnson said German and Italian distributors are reporting weakness. In Europe, economic hardships are causing many countires to do away with subsidies for solar energy. Pricing pressure is another concern, so Johnson plans to sell solar stocks after they report earnings next week.

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CALL THE CLOSE

At the end of Friday's program, the "Fast Money" traders revealed where they think the market could go and how they plan to trade it.

Nike shares fell after reporting earnings, but Virtus Investment Partners' Joe Terranova would buy it at current levels.

Grasso thinks the market could close at the 1,348 level on Friday. He recommends taking profits. Brian Stutland, an options trader agreed with Grasso, but would hedge with options.

Najarian is taking profits, too.

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Trader disclosure: On Feb. 18, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Joe Terranova Owns (VRTS), (C), (UPL), (GM), (MS), (SLXP), (TEVA), (BAX), (CVI), (RSX), (SU) and (CNQ). Steve Grasso owns (ASTM), (BA), (BAC), (BWC), (C), (CSCO), (JPM), (LIT), (LPX), (MT), (MHY), (NDAQ), (PFE), (PRST) and (S). Jon Najarian owns (AKAM), is short (AKAM) calls. Jon Najarian owns (AXL), is short (AXL) calls. Jon Najarian owns (CSTR), is short (CSTR) calls. Jon Najarian owns (JNPR), is short (JNPR) calls. Jon Najarian owns (NBR), is short (NBR) calls. Jon Najarian owns (RSH), is short (RSH) calls. Jon Najarian owns (SVU), is short (SVU) calls. Jon Najarian owns (SWY), is short (SWY) calls. Jon Najarian owns (X), is short (X) calls. Jon Najarian owns (CAT), is short (CAT) calls. Jon Najarian owns (AMD), is short (AMD) calls. Jon Najarian owns (BBY), is short (BBY) calls. Jon Najarian owns (CME), is short (CME) calls. Jon Najarian owns (CBOE), is short (CBOE) calls. Jon Najarian owns (GNW), is short (GNW) calls. Jon Najarian owns (NYX), is short (NYX) calls. Jon Najarian owns (NVDA), is short (NVDA) calls. Jon Najarian owns (V), is short (V) calls. Jon Najarian owns (WMT), is short (WMT) calls. Jon Najarian owns (ARUN), is short (ARUN) calls. Jon Najarian owns (RIMM), is short (RIMM) calls. Jon Najarian owns (GS), is short (GS) calls. Jon Najarian owns (SPWRA), is short (SPWRA) calls

Comcast Is The Parent Company Of CNBC
Comcast Is The Parent Company Of NBCUniversal
GE Owns 49% Of NBCUniversal
GE Owns 49% Of CNBC

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)
Virtus Investment Partners Owns More Than 1% Of (LDR)
Virtus Investment Partners Owns More Than 1% Of (LPHI)
Virtus Investment Partners Owns More Than 1% Of (NRCI)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (XLE)
Virtus Investment Partners Owns More Than 1% Of (XLF)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLK)
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 (DPUKF)

PATTY EDWARDS
Edwards owns (SPY) for clients
Edwards owns (XLB) for clients
Edwards owns (GLD) for clients
Edwards owns (SLV) for clients
Edwards owns (BA) for clients
Edwards owns (AMZN) for clients
Edwards owns (V) for clients
Edwards owns (JNJ) for clients
Edwards owns (AAPL) for clients
Edwards owns (GOOG) for clients
Edwards owns (VZ) for clients
Edwards owns (MSFT) for clients
Edwards owns (C) for clients
Edwards owns (GE) for clients
Edwards owns (TGT) for clients
Edwards owns (CME) for clients
Edwards owns (JWN) for clients
Edwards owns (PEP) for clients
Edwards owns (FXI) for clients

STEVE GRASSO
Stuart Frankel & Co and its partners own (ABX)
Stuart Frankel & Co and its partners own (ABT)
Stuart Frankel & Co and its partners own (AMGN)
Stuart Frankel & Co and its partners own (CSCO)
Stuart Frankel & Co and its partners own (CUBA)
Stuart Frankel & Co and its partners own (GERN)
Stuart Frankel & Co and its partners own (HSPO)
Stuart Frankel & Co and its partners own (NWS.A)
Stuart Frankel & Co and its partners own (NYX)
Stuart Frankel & Co and its partners own (PFE)
Stuart Frankel & Co and its partners own (PRST)
Stuart Frankel & Co and its partners own (SDS)
Stuart Frankel & Co and its partners own (XRX)
Stuart Frankel & Co and its partners own (SDS)
Stuart Frankel & Co and its partners are short (QQQQ)
Stuart Frankel & Co and its partners are short (AAPL)
Stuart Frankel & Co and its partners are short (TIF)

GORDON JOHNSON
Johnson has no disclosures

BRIAN STUTLAND
Stutland is short (MOS) puts
Stutland owns (NEM), is short (NEM) calls
Stutland Equities is a market maker in VIX futures and options holding positions

CNBC.com with wires.

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LOW
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TJX
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WMT
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M
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