Strategy Session with the Fast Money Traders
The fact that Intel didn’t provide guidance shouldn’t be surprising because they didn’t do it last quarter either, muses Guy Adami. I think the stock will be interesting if it slides down at $14.50.
I’m long Intel right now, adds Joe Terranova. And I would add to my position if it trades below $15.
Don’t forget that Intel owns 80% of the chip market, adds CNBC’s Jim Goldman. When the market turns, it seems to me that Intel is as well positioned as any for the long-term. The question is how long must investors wait until the turn?
BREAKING NEWS: SKYPE IPO
After hours, EBay announced plans to spin off its Internet communications service Skype through an initial public offering. The San Jose, Calif.-based eBay expects to complete the IPO in the first half of next year, though it says the timing will be based on market conditions.
EBay bought Skype for $2.6 billion in October 2005. It took a major writedown on the business in 2007, essentially acknowledging it had drastically overvalued it.
This is probably the worst kept secret in tech land, chuckles Jim Goldman. This could be a stock to watch and could be a real money maker as an independent company.
Skype has been a disaster since the get-go, adds Karen Finerman. I don’t know that this is really news.
In tech I’d keep an eye on Hewlett Packard, adds Guy Adami, but wait for the dip.
BANKS FALL AS GOLDMAN PRICES NEW SHARES
Bank shares dragged down the broad S&P 500 on Tuesday after Goldman announced a $5 billion sale of common stock to help pay back the TARP funds. Investors fear other banks could follow suit to relieve themselves of the onerous TARP restrictions.
I was impressed by the way the overall market traded today considering Goldman’s news, adds Tim Seymour. The S&P should have decent support around 833.
Goldman and Morgan can do things that other banks can’t necessarily do, adds Joe Terranova. And if they pay back the TARP they will be able to retain top talent.
Meanwhile, investors remain positive on Citigroup which reports quarterly results later in the week
It’s a phoney up, explains Karen Finerman. Citigroup is nothing but a gigantic short squeeze.
TOPPING THE TAPE: HEALTH CARE
Johnson & Johnson said on Tuesday its quarterly earnings fell, hurt by generic competition for its Risperdal schizophrenia drug and the strong dollar, but lower costs enabled the company to beat Wall Street expectations
J&J, whose shares closed modestly higher, bolstered results by cutting spending more than 10 percent on research, and on sales, general and administrative expenses.
I thought the JNJ earnings were very good, muses Guy Adami. I still like the name.
In the space I’d keep an eye on Dendreon , adds Karen Finerman. An experimental medicine that they make improved survival in men with advanced forms of prostate cancer. However, I’m not sure just how much higher this stock can go.
OIL STUCK AT $50
Oil slipped under $50 a barrel on Tuesday on forecasts for softer demand in 2009 and due to a weekly build in U.S. crude supplies.
The problem in oil is the contango, explains Joe Terranova. It hasn’t come out of the market. However money is moving into the oil services sector and the OIH was up on Tuesday.
I agree, says Tim Seymour.
An unexpected drop in retail sales also dented investor optimism on Tuesday, creating another big drag for stocks and the RTH .
Sales at U.S. retailers fell 1.1 percent in March, snapping two months of increases. Investors had hoped retail sales would show the economic slump was moderating but instead they underscored worries that consumers are reluctant to spend.
The savings rate make me feel encouraged about the consumer, muses Guy Adami. At some point people will wake up, have money in the bank and start spending.
AFTER HOURS ACTION: CSX
CSX , the No. 3 U.S. railroad, on Tuesday reported a better-than-expected quarterly net profit, but much lower than a year ago due to plummeting freight volumes amid the ongoing recession.
The Jacksonville, Florida-based company reported first-quarter net income of $246 million or 62 cents per share, down nearly 30 percent from $351 million or 85 cents per share in the same quarter in 2008.
The stock looks good to me, says Guy Adami. I think it could go to $33.
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Trader disclosure: On Apr 14th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seymour Owns (AAPL), (BAC), (BX), (EEM), (FXI), (F), (PBR), (CSCO), (FDX), (TCK), (SWC); Syemour's Firm Owns (RIG); Terranova Owns (X), (KCE), (AMGN), (DELL), (IBM), (BP), (BRCM), (POT); Terranova Owns (DIS) Calls, (COP) Calls, (HES) Calls, (JPM) & (JPM) Calls, (INTC) & (INTC) Calls, (XOM) & (XOM) Calls; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Finerman's Firm Owns (AXP), (CSCO), (MSFT), (RIG); Finerman's Firm Owns (WFC) Preferred; Finerman's Firm Owns (BIIB) Call Spread; Finerman's Firm Owns (BAC) Preferred; Finerman Owns (BAC) Preferred; Finerman's Firm Is Short (MDY), (SPY), (USO), (BAC), (WFC), (BPO), (ERG); Finerman's Firm Is Short (MDY), (SPY), (USO), (BAC), (WFC), (BPO), (ERG)
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