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Tim Seymour’s Trade According to GARP

Thursday, 19 Jul 2012 | 6:44 PM ET

Fast Money trader Tim Seymour says he’s got a trade that’s all about GARP! (We didn’t know what he meant either.)

Seymour, founder of EmergingMoney.com, tells us that GARP is an acronym for growth at a reasonable price. And his play is long Yum!

“This company is executing on all cylinders,” he exclaims in support of his thesis. “Yes, numbers were weak in the first half due to weaker margins but we knew about that."

What's more important is that Seymour, along with a growing number of other bulls, are looking for a rebound in emerging markets in the second half. Therefore, they argue that Yum!’s presence in China is a catalyst for the stock. “The company is showing 15% growth in China,” he says.

And he likes the stock technically. “It bounced off the 200-day moving average.”

All told, he thinks it’s a buy. “No its not cheap at 18 times forward earnings but as far as I can tell, the company will earn the multiple.”

Trade of the Day: Yum! Brands
The Fast Money traders explain why they "love" Yum! Brands.

Posted by CNBC's Lee Brodie




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Trader disclosure: On July 19, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Tim Seymour is long AAPL; Tim Seymour is long BAC; Tim Seymour is long INTC; Tim Seymour is long SBUX; Tim Seymour is long FCX; Tim Seymour is long YUM; Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long AGU; Guy Adami is long MSFT; Guy Adami is long NUE; Guy Adami is long BTU; Jon Najarian is long AAPL CALL SPREADS; Jon Najarian is long IBM CALL SPREADS; Jon Najarian is long AMZN CALL SPREADS; Jon Najarian is long GOOG CALL SPREADS; Jon Najarian is long MSFT CALLS SPREADS; Jon Najarian is long INTC; Jon Najarian is long CIGX; Jon Najarian is long CME; Jon Najarian is long CBOE; Jon Najarian is long GLUU; Joe Terranova is long VRTS; Joe Terranova is long MCD; Joe Terranova is long USB; Joe Terranova is long GS; Joe Terranova is long JPM; Joe Terranova is long YHOO; Joe Terranova is long SBUX; Joe Terranova is long NKE; Joe Terranova is long WFM; Joe Terranova is long AAPL; Joe Terranova is long EMC; Joe Terranova is long NXPI

For Jason Helfstein
Oppenheimer & Co. Inc. makes a market in the securities of GOOG

CNBC.com with wires.

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