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After Hours Action: Netflix, eBay & Seagate

After the bell the Fast Money traders pored over results from Netflix, eBay and Seagate.

What must you know about these profit reports and how should you trade these names in the wake of earnings?

AFTER HOURS ACTION: NETFLIX

Shares of Netflix popped 6% in extended trade after the company reported higher than expected quarterly profit and revenue and said it added more than one million net new subscribers for the fourth consecutive quarter.

By the numbers the online DVD rental company said it earned an unadjusted 70 cents a share against 52 cents a share in the same period last year.

Revenue for the quarter came in at $553.2 million versus $423 million last year.

What’s the trade?

I like this company and I like what they do, says Brian Kelly. My only disappointment was that I wanted to buy on a pullback.

There’s huge short interest in this name, adds Guy Adami, and I suspect they all get squeezed on Thursday.

The valuations are so stretched I would be terrified to be long, says Karen Finerman.

I agree, says Steve Cortes. I can’t buy this kind of valuation. Stay away.

> For more on Netflix earnings click here

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AFTER HOURS ACTION: EBAY

Shares of eBay traded 6% higher in the after-market Wednesday, when the company reported quarterly profit and revenue that both beat expectations.

The Internet retailer also gave an outlook for the current quarter that outpaced Street forecasts.

By the numbers, the company said it earned 40 cents a share on an adjusted basis in the third quarter, versus 38 cents a share in the same period last year.

Revenue was reported at $2.25 million, against $2.238 billion last year.

Equity analysts who follow the company had expected eBay to report earnings of 37 cents a share on sales of $2.18 billion, according to Thomson Reuters.

What’s the trade?

It feels like the stock may be trying to break out, says Guy Adami. It’s an interesting story but it’s also an old story.

At 16 times this year’s earnings, I think eBay is attractive, says Patty Edwards. And personally I’ve noticed people are starting their own business using eBay as the forum to sell their merchandise. I think the stock has some legs.

I’m more comfortable with this earnings multiple, says Karen Finerman, but that’s as compared to Netflix.

> For more on eBay earnings click here


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AFTER HOURS ACTION: SEAGATE

Shares of Seagate remained relatively unchanged in extended trade despite a profit report which disappointed investors with lower than expected net income and revenue.

Also Seagate did not provide financial forecasts or any information about possibly going private.

Seagate said in a statement that due to "regulatory requirements," the company would not provide more details about its talks to possibly go private, and that it would not give information regarding its financial outlook.

By the numbers Seagate said net income fell to $149 million, or 31 cents per diluted share, from $179 million, or 35 cents per diluted share, a year earlier.

Excluding items, the company reported earnings of 37 cents a share. Analysts expected EPS of 45 cents, according to Thomson Reuters I/B/E/S.

What’s the trade?

I think the takeover story is on the only reason to own the stock, says Brian Kelly, and as far as I’m concerned that’s not a reason to own it.

But I wouldn’t get short, adds Guy Adami. That could be a disaster.

> For more on Seagate earnings click here


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Trader disclosure: On Oct. 20, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Cortes is short crude oil; Cortes is short gold; Cortes is short (BIDU); Cortes is short (RSX); Cortes owns U.S. Treasuries; Cortes owns the S&P 500; Adami owns (AGU), (BTU), (NUE), (C), (GS), (INTC), (MSFT); Adami’s wife works at Merck; Jon Najarian owns (AAPL) calls; Jon Najarian owns (BA) calls; Jon Najarian owns (GS) calls; Jon Najarian owns (NFLX) calls; Jon Najarian owns (PAAS) puts; Finerman owns (AAPL); Finerman and Finerman’s firm owns (BAC); Finerman and Finerman’s firm owns (JPM); Finerman and Finerman’s firm owns (GOOG); Finerman’s firm owns (IBM); Finerman’s firm owns (HPQ); Finerman’s firm owns (MSFT); Finerman's firm is short (IJR); Finerman's firm is short (MDY); Finerman's firm is short (SPY); Finerman's firm is short (IWM); Finerman’s firm owns S&P 500 puts; Finerman’s firm owns Russell 2000 puts

For Brian Kelly:
Accounts managed by Kanundrum Capital own (GLD)
Accounts managed by Kanundrum Capital own (GDXJ)
Accounts managed by Kanundrum Capital own (SLV)
Accounts managed by Kanundrum Capital own (SGG)
Accounts managed by Kanundrum Capital own (POT)
Accounts managed by Kanundrum Capital own (JJG)
Accounts managed by Kanundrum Capital own (JO)
Accounts managed by Kanundrum Capital own (UUP)
Accounts managed by Kanundrum Capital own (REE)
Accounts managed by Kanundrum Capital own (MCP)
Accounts managed by Kanundrum Capital own (JEF)
Accounts managed by Kanundrum Capital own (TIP)
Accounts managed by Kanundrum Capital own the Swiss Franc
Accounts managed by Kanundrum Capital are short the UK Pound
Accounts managed by Kanundrum Capital are short the Mexican Peso

For Patty Edwards
Edwards owns (AAPL) for clients
Edwards owns (BA) for clients
Edwards owns (EBAY) for clients
Edwards owns (FCX) for clients
Edwards owns (GS) for clients
Edwards owns (JPM) for clients
Edwards owns (MAT) for clients
Edwards owns (USB) for clients

For Eric Jackson
***No Disclosures***

For Peter Misek
Jefferies makes a market in (AAPL)

For Charles Biderman
***No Disclosures***

For Stephen Weiss
***No Disclosures***

For Mike Khouw
***No Disclosures***

CNBC.com with wires.