Alibaba's stock slide—partly reflected in some major hedge funds exiting positions—provides a strong entry point for investors, CNBC "Fast Money" traders said Friday.
Dan Loeb's Third Point Capital and John Paulson's Paulson and Co. both sold big Alibaba stakes in the first quarter, according to filings. The stock has fallen nearly 15 percent this year, driven down by disappointing fourth-quarter results.
"I like Alibaba down at these levels," said trader Brian Kelly.
The Chinese e-commerce giant's stock closed at about $88 per share on Friday. Alibaba looks cheap at these levels, said trader Tim Seymour.
Alibaba could "move a lot higher," especially because the company put together a strong first quarter, said trader David Seaburg. It earlier this month reported earnings and revenue that topped analysts' expectations.
As many first-quarter filings from hedge funds surfaced on Friday, traders discussed how to play stocks top investors were buying and selling.
Keith Meister's Corvex Management and Jana Partners were among the funds that added positions in the fast food giant in the first quarter. "Even without activists," McDonald's has upside as its stock has fallen more than 4 percent in the last year, said trader Steve Grasso.
McDonald's shares closed around $98 on Friday.
Grasso added that he would sell Taco Bell and Pizza Hut parent Yum Brands, which has "grossly outperformed" in jumping nearly 30 percent this year.
Seymour—whose firms owns McDonald's stock—said activism provides "another catalyst." Kelly agreed, saying the struggling stock looks appealing regardless of activist influence.
Seaburg, however, noted the company may need to improve its capital return to send its stock higher.
Leon Cooperman's Omega Advisors added shares of automaker General Motors in the first quarter. Despite activism, GM seems to be at "a good risk-reward point," Kelly said.
GM shares closed just below $35 on Friday.
Tim Seymour is long AAPL, T, BAC, C, DAL, DIS, F, GE, GM, GOOGL, INTC, JCP, SUNE and TUR. Tim's firm is long BABA, BIDU, MCD, NKE, NOK, SBUX and YHOO.
Steve Grasso is long AAPL, BAC, BTU, DD, EVGN, MJNA, PFE, T, TWTR and GDX. His kids own EFG, EFA, EWJ, IJR and SPY.
Brian Kelly is long DXGE, BTC=, BBRY, SPY puts and U.S. dollar. He is short Australian dollar, euro, yen and yuan. Today, he bought DXGE and sold short euro.