Intel shares plummeted on the company’s lowered profit outlook Monday, leading the “Fast Money” experts to look elsewhere for a better play.
“I don’t think the reasons for its sell-offs are particularly rational in that an inventory issue based on flooding in Thailand says nothing about intrinsic end demand,” said trader Zack Karabell.
Intel’s forecast, which revised fourth-quarter revenue to $13.7 billion from $14.7 billion, cited lower availability of hard drives. The stock traded at $28.34 at 1 p.m, down almost 4.7 percent.Karabell said he liked Intel but that wireless companies were a better bet because they operate in an industry that has been expanding even in a troubled economy.
“Which is why you don’t want to own Intel,” said trader Steven Weiss. “You want to own Qualcomm.”
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> NEW SLIDESHOW: Slo-o-o-w Money, 10 Top Stocks for the Long-Term Investor
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Trader Steve Grasso of Stuart Frankel said that industry watchers felt as if the lowered outlook should have happened earlier.
“Intel was starting to get in favor with people who didn’t like Intel, and I was one of those guys,” he said.
In October, Intel reported third-quarter results that beat expectations. The computer chip maker issued a bullish forecast, brushing aside concerns that increasing demand for tablets would cut into demand for PCs.
“That 3, 4 points of sequential growth turned out to be 6 or 7 points of sequential decline,” said Craig Berger, senior analyst at FBR Capital Markets.
“I think it’s time to be buying some of these other cyclically depressed chip firms,” he added.
Berger mentioned three other stocks worth a look:
- ONNN Semi “is super beat-up.”
- Fairchild Semi
- Broadcom “A bigger name that’s more cyclically depressed.”
Related
______________________________________________________ For Steve Grasso Stuart Frankel & Co and its partners own CUBA Stuart Frankel & Co and its partners own GERN Stuart Frankel & Co and its partners own HPQ Stuart Frankel & Co and its partners own HSP Stuart Frankel & Co and its partners own HSPO Stuart Frankel & Co and its partners own MET Stuart Frankel & Co and its partners own MU Stuart Frankel & Co and its partners own NYX Stuart Frankel & Co and its partners own PRST Stuart Frankel & Co and its partners own RDC Stuart Frankel & Co and its partners own UAL Stuart Frankel & Co and its partners own XRX For Simon Baker For Urs Dur Lazard Capital Markets LLC makes a market in UPS securities For Mark Fields For Colin Gillis Lead or Co-manager: BGC Financial LP and/or its affiliates, has not acted as lead or co-manager in a public offering of equity and/or debt securities for Amazon within the last 12 months. BGC Financial LP and/or its affiliates has not received compensation for investment banking services in the last 12 months from Amazon. For Dennis Gartman Gartman is long equities For Craig Berger CNBC.com with wires.
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Trader disclosure: On Dec. 12, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders: Kelly is long IWM; Kelly is long LNG; Kelly is long EUR; Kelly is long CHF; Cortes is long; Cortes is long Treasuries; Cortes is long INTC; Cortes is long SVU; Cortes is long TSN; Cortes is short; Cortes is short AUD; Cortes is short EUR; Cortes is short GBP; Cortes is short AAPL; Cortes is short DB; Cortes is short Crude; Grasso owns ASTM; Grasso owns AVAV; Grasso owns BA; Grasso owns D; Grasso owns LIT; Grasso owns MHY; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XLU; Weiss owns EUO; Weiss owns JPM; Weiss owns QCOM; Weiss owns HPQ; Weiss owns GM;
Stuart Frankel & Co and its partners own CSCO
Simon Baker OWNS Abbott Labs
Lazard Capital Markets LLC makes a market in FDX securities.
No disclosures
Investment banking (next 3 months): BGC Financial LP and/or its affiliates, expect to receive, or intend to seek, compensation for investment banking services within the next three months from all of the companies referenced within this report.
Gartman is short Euro
FBR acts as a market maker or liquidity provider for the company's securities: INTC.