Looking at the numbers, the company forecast earnings, excluding items, for fiscal 2011 will rise 12 percent to 14 percent to $5.05 to $5.15 a share on revenue of $131.5 billion to $133.5 billion.
Wall Street is targeting earnings of $4.99 a share on revenue of $131.4 billion for the next fiscal year, according to Thomson Reuters I/B/E/S.
What’s the trade?
On the news, I think money managers now start to rotate money out of IBM and into HP, speculates Joe Terranova.
I think valuations in HP are very fair here, says Guy Adami. But I’d wait to see what the market is doing before making any big moves.
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GREEN MOUNTAIN PLUNGES 10% AFTER HOURS
Shares of Green Mountain plunged almost 10% in extended trade after the company disclosed that the SEC has requested documents related to “certain revenue recognition practices and the Company’s relationship with one of its fulfillment vendors.”
What’s the trade?
This is a game changer. If you’re long the stock this is probably a good time to hedge your exposure, says Joe Terranova.
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APPLE, RESEARCH IN MOTION LEAD TECH SHARES LOWER
Apple was among the big losers in tech Tuesday with jittery investors taking shares down sharply on reports that HP was courting Apple COO and heir apparent Tim Cook to replace Mark Hurd.
As you may know Gleacher analyst Brian Marshall talked with us on the Halftime Report after chatting with Cook personally about the speculation.
According to Marshall the rumors are “definitely false.” (Click here to go to “Is HP Trying To Poach Apple?")
What should you make of it?
If you’ve had a run in Apple this may be the time to sell, says Guy Adami. Maybe this tells you Apple isn’t going to climb forever.
For me the move demonstrates that as goes Apple so goes the market, says Brian Kelly.
In the space, I’d play long Verizon, says Stephen Weiss author of The Billion Dollar Mistsake, as a bet Verizon gets the iPhone.
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RIM DISAPPOINTS
Elsewhere in tech, it’s safe to say investors were underwhelmed by the new Playbook tablet unveiled by RIM on Monday. Shares of the BlackBerry maker led the space lower.
What’s the trade?
I don’t like their timing, says Brian Kelly. It’s coming out after the holidays and right when their rivals will introduce their tablets at the Consumer Electronics Show.
I may stand alone but I think the Playbook puts a foundation under the stock, says Joe Terranova. I think it no longer continues its precipitous decline.
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TOPPING THE TAPE: CLOUD STOCKS
Cloud computing stocks topped the tape in tech on Tuesday with Rackspace and NetApp both celebrating new 52 week highs.
What’s the trade?
NetApp has climbed so much it’s just about priced out of being an attractive takeover target, says Pete Najarian. But maybe that was never behind the run to begin with.
The cloud space is the one area of tech that I like, says Brian Kelly. I think the iPad changes the game if you can store data in the clouds.
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UNDER THE RADAR: SUCCESSFACTORS (SFSF)
Ever since the 3PAR bidding war, cloud computing stocks have been under the spotlight but Fast Money trader Joe Terranova is watching, Success Factors, a name that has remained "under the radar."
What must you know about this stock? Following are some important points:
-Cloud-Based ‘Management’ Software
-Bookings Growth Up 20%
-Market Cap: $1.9 BLN
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UNUSUAL ACTIVITY: CASINOS
Pete Najarian has spotted some unusual options action in the casino names.
If MGM can break above 11.50 it should have plenty more upside and that's what options players are looking for, he says.
I like Las Vegas Sands much more, counters Brian Kelly. MGM is looking to spin-off their assets in Macau and that's their crown jewel.
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ANALYZE THIS: GOLD, COMMODITIES TRADE OF DAY, MONTH, YEAR
Once again gold made a new high on Tuesday amid a weaker dollar and a lower than expected consumer confidence.
But gold can’t just go up, up up --- can it? When does it turn?
For insights we turned to Rich Ilczyszyn, Lind-Waldock Senior Market Strategist.
He tells us he expects to see capitulation. "I’m looking for a 2-5% correction from $1300 - $1325 on the high side down to a level of about $1240. Book some profits-- now it's time to hedge your downside risk."
What else does he tell the desk? Check out our entire conversation. Watch the video now!
