Speculation that Research In Motion could be a takeover target caused shares of the BlackBerry maker to soar on Wednesday.
“We’ve all talked about this for along time,” said Pete Najarian, co-founder of optionMONSTER.com, admitting the stock is attractive at current levels. “Who do they fit with best that's actually the marriage partner we’d like to find and who actually has the capital to invest in something like RIM?”
HTC, Microsoft and Vodafone are among the companies rumored to be looking at RIM as a possible takeout target, options trader Jon Najarian said from the Chicago Mercantile Exchange.
“I don’t like to play on ‘ifs’ as much,” Jon said. “I like to look at what’s oversold, overbought and then I like to get on the other sides of them.”
Research In Motion was one of the most undervalued stocks going into the end of the third quarter, Jon said. A short-term trader, he saw an opportunity to get into the stock before the quarter ended last week. Even with heavy pressure on both Friday and Monday, RIMM was able to push higher. Jon took his profits and is now out of the stock. RIMM is more fairly valued, but Jon thinks it still has more upside.
Investors should take their profits and walk away from RIMM, said Josh Brown of Fusion Analytics Investment Partners. RIM has a huge installed user base, but aside from that, Brown sees little value in the company. A takeover is highly unlikely, he said, because the founders are two of the company’s top executives. So for them, Brown thinks things would have to get much worse before they would consider a buyout.
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Trader disclosure: On Oct. 5, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Pete Najarian is long (AAPL). Pete Najarian is long (C). Pete Najarian is long (MS). Pete Najarian is long (MSFT). Jon Najarian is long (AAPL) call spreads. Jon Najarian is long (CY) call spreads. Jon Najarian is long (SWKS) call spreads. Jon Najarian is long (RIMM) call spreads. Jon Najarian is long (MMR) call spreads. Jon Najarian is long (NfLX) call spreads. Jon
Najarian is long (X) call spreads. Jon Najarian is long (CME). Jon Najarian is long (CBOE). Jon Najarian is long (CIGX). Dennis Gartman: Gartman owns (C), Gartman is short EUR; Gartman is short the Sterling, Gartman is short S&P futures, Gartman owns FAX, Gartman owns FCX, Gartman own AAPL. Karabell owns (JPM)Zachary Karabell: Karabell owns (AAPL); Karabell owns (MSFT); Karabell owns (GOOG); Karabell owns (MON).
Zach Karabell
Rivertwice Capital is short (XLF)
Rivertwice Capital is short (SPY)
Rivertwice Capital is owns (MON) puts
Rivertwice Capital is owns (TGT) calls
Dennis Gartman
Funds Managed by Dennis Gartman are long (FAX)
Funds Managed by Dennis Gartman are long the Australian Dollar
Funds Managed by Dennis Gartman are long the Canadian Dollar
Funds Managed by Dennis Gartman are long (CF)
Funds Managed by Dennis Gartman are short the S&P
Funds Managed by Dennis Gartman are short the EUR
Funds Managed by Dennis Gartman are short the Sterling
CNBC.com with wires.
