Will Google earnings, due to be released Thursday, finally provide this stock with the traction it’s been lacking?
Or will they confirm the Street’s worst fears? That pulling out of China was one giant mistake.
The company may well be at an inflection point. Considering the potentially fragile state of this trade we thought you’d appreciate some diverse perspectives.
Following you’ll find fundamental and technical insights as well as thoughts from the options world.
FUNDAMENTALS
Jefferies analyst Youssef Squali is largely bullish on the fundamentals. “We love Google into earnings,” he says. Here are his two main reasons.
1) “We think the company is going to report a good quarter. We think earnings are going to be up close to 30% on 20% plus top revenue growth.”
2) “The stock has actually trailed the other large cap internets down 7% year to date. We think the stock will react positively on the print.”
TECHNICALS
Carter Worth of Oppenheimer is pessimistic. Patterns in the charts of Google reveal “a major break in trend,” says Worth.
And he finds the momentum bearish. The stock is “failing to get back above the level from which it sold off.”
Considering the poor relative strength, “stay away,” counsels Worth
OPTIONS
Jon Najarian thinks no matter what happens the stock could make a big move post earnings. He tells the desk options traders are pricing in “a 4 percent earnings move.”
But there’s more.
”Strangely enough, that’s the same amount they priced in last time and Google actually moved 8%. So keep an eye on this one.”
What’s the trade?
According to Biryini, you may have more to lose than you have to gain, explains host Melissa Lee. When the stock beats on average it gains four percent or so; but when it misses, it costs investors almost ten percent.
I think the trade is long into earnings, says Joe Terranova. The expectation is that they will miss and the stock will go lower. I think the upside surprise is the attractive trade.
I’m also bullish Google, says Brian Kelly. It’s not an average market and I don’t think this will be an average earnings report.
What do you think? We want to know!
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Trader disclosure: On Apr 14, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Kelly Owns (DHI), (MS), (GOOG), (IBM), (TXN), (S); Terranova Owns (AXP), (HES), (TER), (APA), (YHOO), (MOS), (SWN), (XCO); Terranova Is Short (LCC); Terranova Owns (C) Calls; Kelly Owns (FXE) Puts ; Kelly Owns (FRE); Adami Owns (INTC), (GS), (AGU), (MSFT), (NUE), (BTU), (C) ; Seymour Owns (BAC), (EEM), (F), (INTC), (LVS), (SBUX), (AA), ( BX), (MGM); Najarian Owns (BAC) Call Spread; Najarian Owns (C) Calls; Najarian Owns (FITB) Calls; Najarian Owns (LVS) Call Spread ; Najarian Owns (MOS) Call Spread; Najarian Owns (PCX); Najarian Owns (YHOO) Call Spread; Najarian Owns (YUM) Calls; Gartman Owns (DRI), (PNRA), (CMG); Cortes is Short (LVS) & (WYNN)
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