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Traders: How to play brutal retail earnings

A choppy retail earnings season continued Wednesday, and "Fast Money" traders looked through the wreckage at how to play the sector.

Shares of Target and L Brands fell after the companies posted quarterly results Wednesday. Their reports follow disappointing results from Nordstrom and J.C. Penney, among others.

Traders saw some opportunities in that disappointment.

Trader Tim Seymour contended Nordstrom could have upside, as the stock's battering looks "way overdone." It has fallen about 27 percent this year.

Target shares, which fell more than 7 percent Wednesday, could have potential as a trade, said trader Steve Grasso. He added that J.C. Penney would make a more risky trade.

Trader Pete Najarian, meanwhile, saw one key culprit in the retail pain: malls. He said he recently bet against mall developer General Growth Properties with put options.

Despite the tough stretch for retail earnings, some companies have enjoyed success. Home improvement companies Lowe's and Home Depot both beat earnings estimates.

Home Depot shares have fallen each of the past two sessions, but trader Guy Adami contended the selling would be "short-lived."

Disclosures:

Guy Adami

Guy Adami is long CELG, EXAS, GDX, INTC, Guy Adami's wife, Linda Snow, works at Merck.

Steve Grasso

Steve is long BA, CC, DD, DIS, EVGN, KBH, MJNA, MU, OLN, PFE, PHM, T, TWTR, GDX Steve's kids own EFA, EFG, EWJ, IJR, SPY

Pete Najarian

Long AAPL, BAC, BMY, CSCO, DIS, DISCA, GE, GS, KMI, KMI.A, KO, LUX, MRK, PEP, PFE, SAVE, VIAB, ZIOP Long Calls: AAL, AGN, AKS, AMJ, COP, EGO, EWZ, GS, GSAT, HAL, HAIN, HBAN, KATE, KBH, KMI, LLY, MSFT, MT, NOK, NLNK, POT, SBUX, SLV, SVU, TCK, TEX, UAL, YHOO Long Puts: BBY, BID, FCX, NOV, PBR, VLO

Tim Seymour

Tim Seymour is long AAPL, AVP, BAC, BBRY, CLF, DO, EDC, EWZ, F, FCX, FXI, GM, GOOGL, GRMN, GE, GLNCY, INTC, LQD, MCD, MPEL, NKE, RACE, RAI, RL, SINA, T, TWTR, UA, VALE, VZ, XOM. Tim's firm is long BABA, BIDU, CLF, EWZ, F, HD, KO, MCD, MPEL, NKE, PEP, PF, SAVE, SBUX, SINA, VALE, VIAB, WMT, WEN, YHOO, short HYG, IWM, WYNN