Fast Money’s All- American Trades
With China and Europe cited as drags on corporate profits, the Fast Money pros are going all-American.
That is, they’re looking at stocks of companies that are headquartered in the US and derive most if not all of their revenue domestically.
Here’s what they suggest.
Dick's Sporting Goods
One of the nation’s largest sporting goods companies, Terranova likes Dick's Sporting Goods for strong margins.
When the Pennsylvania-based company reported earnings in May, they beat the Street with first-quarter earnings per share jumping 50% to 45 cents per share; estimates were 38 cents a share.
Net sales rose 15 percent to $1.3 billion, with same-store sales -- or those at stores open at least a year -- increasing 8.4 percent. Analysts were expecting revenue of $1.23 billion.
Terranova also likes Dick’s as a beneficiary of the Olympics, believing the London games will spark greater interest in athletics.
Packaging Corp of America
A producer of containerboard and corrugated products in the United States, Illinois-based Packaging Corp of America consists of mills and corrugated manufacturing operations.
When the companyreported earnings on April 17th, they said first-quarter net income fell to $18 million, or 18 cents per share, from $37.4 million, or 37 cents per share, last year. Analysts expected earnings of 40 cents on revenue of $659.65 million, according to Thomson Reuters I/B/E/S. However, excluding items, the company earned 42 cents.
Also on a more positive note, revenue rose 7 percent to $671 million. Corrugated products shipments were up 8.3 percent for the quarter.
Edwards sees this stock as a long-term bet on a slow and steady US recovery. As the economy picks up, demand for their products should increase, too. “And they have a nice dividend,” she says.
When Harley-Davidsonreported earnings in April, they reported a stronger-than-expected rise in quarterly profit saying the U.S. economy was on the mend, young customers were embracing its brand and it had shipped more motorcycles than it had expected in January.
Net earnings rose to $172 million, or 74 cents per share, from $119 million, or 51 cents per share, a year earlier.
Analysts, on average, were expecting profit of 72 cents a share, according to Thomson Reuters I/B/E/S.
Product sales jumped 20 percent to $1.27 billion, compared with Wall Street estimates of $1.22 billion. U.S. sales were up 26 percent, outpacing industry growth.
The Milwaukee-based company said it now expects to ship 245,000 to 250,000 motorcycles worldwide this year, raising its estimate by 5,000 units. It added that it had limited ability to produce additional motorcycles.
“Their numbers in April were fantastic,” says Najarian, “and the projections were strong this year. They’ve had some struggles but I think now they’re doing everything right.
Posted by CNBC's Lee Brodie
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Trader disclosure: On July 3, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Patty Edwards is long MCD; Patty Edwards is long for clients WFM; Patty Edwards is long for clients BGS; Patty Edwards is long for clients CBI; Patty Edwards is long for clients WDFC; Pete Najarian is long AAPL; Pete Najarian is long AAPL CALLS; Pete Najarian is long BAC CALLS; Pete Najarian is long C; Pete Najarian is long INTC; Pete Najarian is long SBUX; Pete Najarian is long FB; Pete Najarian is long MSFT; Pete Najarian is long LULU CALLS; Pete Najarian is long NKE CALLS; Pete Najarian is long NOK; Joe Terranova is long VRTS; Joe Terranova is long MCD; Joe Terranova is long PNC; Joe Terranova is long USB; Joe Terranova is long TCBI; Joe Terranova is long SBUX; Joe Terranova is long MNST; Joe Terranova is long NKE; Joe Terranova is long UPL; Joe Terranova is long WFM; Joe Terranova is long AAPL; Joe Terranova is long EMC; Joe Terranova is long NXPI; Joe Terranova is long LPX
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Ron Carson is long DE
Ron Carson is long POT
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SFG is a market maker in the securities of Expedia, Inc. EXPE
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