Traders: Here's how we're playing retail

"Fast Money" traders on Thursday tried to make sense of an erratic retail earnings season.

Wal-Mart earlier in the day posted earnings and revenue that beat expectations. It fared better than many of its peers in retail, which suffered after disappointing results.

With retail earnings largely wrapped up, "Fast Money" traders picked how they would play the sector.

Wal-Mart: Despite Wal-Mart's earnings beat, trader Dan Nathan said he would not buy the stock after its 9.6 percent increase Thursday. He noted that expectations were already low and same-store sales only increased 1 percent.

Kate Spade and Ulta: Shares of Kate Spade and Ulta have climbed 23 and 12 percent, respectively, this year. Trader Steve Grasso said he would buy those stocks on "any weakness."

Home Depot: Home Depot shares fell Wednesday and traded about flat Thursday despite the home improvement retailer beating earnings expectations earlier in the week. Adami said he would buy Home Depot and sell Wal-Mart after their moves.

Michael Kors: Michael Kors shares have plunged 33 percent in the last year. Trader Karen Finerman said the market has priced in weakness to next month's earnings already, and a bounce could be played with call spreads.

Disclosures:

Guy Adami

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

Karen Finerman

Karen is long BAC, C, DRII, DRII calls, FB, FL, GOOG, GOOGL, JPM, LYV, KORS, KORS long call spreads, M, MA, SEDG, SPY puts, URI. Her firm is long ANTM, AAPL, BAC, C, C calls, DRII, DRII calls, FB, GOOG, GOOGL, JPM, JPM calls, KORS, LYV, M, MOH, PLCE, SPY puts, URI, her firm is short IWM, MDY. Karen Finerman is on the board of GrafTech International.

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

Dan Nathan

Long PFE Long TWTR, GE long May 28 puts XHB long June put spread IWM long Sept 100 put XLB long June put spread XLF long May/ Sept Put spread HYG long June put spread XLK long Sept Put spread FXI long aug put spred SMH long aug put spread, KO june / aug put calendar, long UA call calendar, long PYPL call calendar