×

After Hours Action: NVIDIA, AMD, Alcoa and Apollo

AFTER HOURS ACTION: AMD

Although shares of Advanced Micro Devices closed higher on a bullish analyst call, they sold off sharply in extended trade when word hit that Chief Executive Dirk Meyer had resigned and would be replaced by Chief Financial Officer Thomas Seifert while the chipmaker searches for a permanent replacement.

The change will accelerate AMD's ability to "establish market leadership and generate superior financial returns," said a statement by Bruce Claflin, the chairman of AMD's board of directors.

AMD also said its fourth quarter revenue increased 2 percent sequentially to $1.65 billion, with gross profit margin of roughly 45 percent. The company is scheduled to deliver full fourth quarter results on Thursday.

AMD is the No.2 maker of PC microprocessors, behind Intel, whose chips are used in more than 80 percent of the world's PCs.

What’s the take away?

Historically when a CEO resigns, it’s not a good thing, says Karen Finerman. Typically investors assume the worst until they hear otherwise.

We may see a little hit, admits Joe Terranova, but longer term I like this stock.

Hear more from FBR analyst Craig Berger. Watch the video now!

Read More:

Click here for “Stealth Apple Winner” Find out why Nomura analyst Romit Shah thinks Steve Jobs and company might find the latest generation of microchips from AMD irresistible.

----------

AFTER HOURS ACTION: NVIDIA

In extended trade Nvidia's shares jumped more than 6% after the company said Intel would pay graphics chip designer Nvidia a $1.5 billion licensing fee, settling a legal dispute over a license to make chipsets.

Under the agreement, Intel, the world's largest microchip maker, will be allowed to use some patents belonging to Nvidia.

"Impressive, it's a big number," says Doug Freedman, an analyst at Gleacher & Company, in a Reuters interview.

Intel sued Silicon Valley neighbor Nvidia in 2009 and Nvidia counter-sued in the fight over chipsets, which are groups of integrated circuits that connect to the microprocessor in a PC.

In 2004, Intel agreed to let Nvidia, which specializes in graphics processors, design chipsets for its microprocessors, while it would be able to use some of Nvidia's technology in its own chipsets.

But in its suit filed in a Delaware court, Intel said the agreement did not extend to new microprocessors it later launched with a new component called integrated memory controllers.

What’s the trade?

If Nvidia pulls back over the next 10 days, I'm a buyer, counsels Joe Terranova.


----------

AFTER HOURS ACTION: APOLLO

Meanwhile shares of Apollo surged in extended trade after the company reported a better-than-expected quarterly profit helped by higher tuition fees.

However, new student enrollment at its University of Phoenix for the quarter fell 42.4 percent, while degreed enrollment fell 3.8 percent.

Apollo said the decline was due to change in admission policies and how it evaluates compensation for its counsellors.

By the numbers, Apollo's first-quarter earnings from continuing operations was $1.63 a share, excluding items, above Wall Street view of $1.35 a share.

Revenue rose 5.4 percent to $1.33 billion, while analysts were expecting $1.26 billion.

For-profit colleges such as Apollo's University of Phoenix have come under fire for burdening students with debt without training them properly for the workplace.

What’s the takeaway?

Sometimes the best trade is no trade, says Joe Terranova. There is so much volatility in this space, I just think there are better places to put money to work.

----------

AFTER HOURS ACTION: ALCOA

After hours, Alcoa kicked off earnings season with a bang. The aluminum giant reported a profit that jumped from last year and surpassed what Wall Street was expecting as aluminum prices rose in the year's final quarter after two years of weakness.

The company said it earned 21 cents a share in the fourth quarter excluding one-time items, compared with 1 cent a share last year.

Analysts who follow Alcoa on average expected the company to turn in a profit of 19 cents a share on sales of $5.7 billion.

"The good news is growth—if you look at it from a year ago, we've grown revenues by 14 percent," Alcoa Chairman and CEO Klaus Kleinfeld told CNBC Monday. "All of that is nice...I think we have a nice momentum."

The chief executive said he sees growth continuing from emerging economies such as India and Vietnam.

"They will accelerate their growth, and that makes us believe we are going to have another great year for aluminum growth, and 12 percent is our number," Kleinfeld said.

He said he sees growth from China slowing, however: "We actually do see from a regional perspective China is slowing down a little bit—we saw China grow 21 percent in 2010, we think it's going to come out at 15 percent."

In terms of the domestic market, Kleinfeld said Alcoa has seen "quite a bit of stabilization" in the United States.

"I'm more optimistic on the U.S. than I've seen most of analysts out there. And that is driven by quite a number of factors—just look at automotive sales in December," he said.

Alcoa's performance in the fourth quarter came despite exchange rates that worked against the company, Kleinfeld said.

"We've seen quite a bit going against us this year" in terms of currencies, he said. "What you can see in the numbers is we have been able to compensate for that."

What’s the trade?

If you’re looking for an aluminum trade take a look at Moscow-based RusAl, says Joe Terranova.

----------

CAN YOU HEAR IPHONE NOW?

Apple hit fresh all time highs in anticipation of Verizon’s iPhone announcement on Tuesday.

What’s the trade?

I think Verizon will pop on the news but gains may be short lived if they’re faced with pricing challenges to compete, says Jon Najarian. I suspect they’ll have to offer unlimited data to win business away from rival with AT&T.

I think the path for Apple will be almost straight up to $400, adds Joe Terranova. And I suspect the loser here will be Sprint.





______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our Web site send those e-mails to fastmoney@cnbc.com.

Trader disclosure: On January 10, 2010, 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); Seymour owns (BAC); Seymour owns (F); Seymour owns (FXI); Seymour owns (GE); Terranova owns (GM); Terranova owns (C); Terranova owns (VRTS); Terranova owns (UPL); Terranova owns (PEP); Terranova owns (OXY); Terranova owns (GS); Terranova owns (LTD); Terranova owns (CNQ); Terranova owns (PVH); Terranova owns (CVI); Terranova owns (GLD) puts; 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 is short (XRT); Finerman's firm is long S&P puts; Finerman's firm is long Russell 2000 puts; Finerman owns (AAPL); Finerman owns (BAC); Finerman's firm owns (BBY); Finerman owns (BP); Finerman's firm owns (BP); Finerman's owns (GOOG); Finerman owns (HPQ); Finerman's firm owns (HPQ); Finerman's firm owns (IBM); Finerman owns (JPM) and (JPM) leaps; Finerman's firm owns (JPM) and (JPM) leaps; Finerman owns (MSFT); Finerman's firm owns (MSFT); Finerman's firm owns (WMT); Jon Najarian owns (AA), is short (AA) calls; Jon Najarian owns (AAPL), is short (AAPL) calls; Jon Najarian owns (APOL) put spreads; Jon Najarian owns (BAC), is short (BAC) calls; Jon Najarian owns (BBY), is short (BBY) calls; Jon Najarian owns (F), is short (F) calls; Jon Najarian owns (GM), is short (GM) calls; Jon Najarian owns (GS), is short (GS) calls; Jon Najarian owns (IBM), is short (IBM) calls; Jon Najarian owns (MOS), is short (MOS) calls; Jon Najarian owns (MSFT), is short (MSFT) calls; Jon Najarian owns (NFLX), is short (NFLX) calls; Jon Najarian owns (ORCL), is short (ORCL) calls; Jon Najarian owns (RIMM), is short (RIMM) calls

For Joe Terranova
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
Virtus Investment Partners Owns More Than 1% Of (ABAX)
Virtus Investment Partners Owns More Than 1% Of (AMKR)
Virtus Investment Partners Owns More Than 1% Of (CCG)
Virtus Investment Partners Owns More Than 1% Of (CASS)
Virtus Investment Partners Owns More Than 1% Of (CSVI)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (FCFS)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (KRC)
Virtus Investment Partners Owns More Than 1% Of (LDR)
Virtus Investment Partners Owns More Than 1% Of (LPHI)
Virtus Investment Partners Owns More Than 1% Of (NCRI)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (XLE)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLK)
Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (SUBK)
Virtus Investment Partners Owns More Than 1% Of (WDFC)
Virtus Investment Partners Owns More Than 1% Of (YDNT)
Virtus Investment Partners Owns More Than 1% Of (CLB)

For Brian Kelly
Accounts Managed By Kanundrum Capital Own (TBT)
Accounts Managed By Kanundrum Capital Own (YGE)
Accounts Managed By Kanundrum Capital Own (FCX)
Accounts Managed By Kanundrum Capital Own (MON)
Accounts Managed By Kanundrum Capital Own (ANDE)
Accounts Managed By Kanundrum Capital Own (GLD)
Accounts Managed By Kanundrum Capital Own (JPM) puts
Accounts Managed By Kanundrum Capital Are Long USD
Accounts Managed By Kanundrum Capital Are Short The Euro
Accounts Managed By Kanundrum Capital Are Short The Yen
Accounts Managed By Kanundrum Capital Are Short (XLF)

For Betsy Graseck
(C) may be deemed to control Morgan Stanley Smith Barney LLC due to ownership, board membership, or other relationships. Morgan Stanley Smith Barney LLC may participate in, or otherwise have a financial interest in, the primary or secondary distribution of securities issued by (C) or an affiliate of (C) that is controlled by or under common control with Morgan Stanley Smith Barney LLC.
Within the last 12 months, Morgan Stanley managed or co-managed a public offering (or 144A offering) of securities of (BNY), (C), (KEY), (NT), (PNC), (USB), (WFC)
Within the last 12 months, Morgan Stanley has received compensation for investment banking services from (AXP), (BAC), (BNY), (BBT), (COFI), (C), (DFS), (FITB), (JPM), (KEY), (NT), (PNC), (USB), (WFC)
In the next 3 months, Morgan Stanley expects to receive or intends to seek compensation for investment banking services from American Express Company, Bank of America, Bank of New York Mellon Corp, BB&T Corporation, Capital One Financial Corporation, Citigroup Inc., Discover Financial Services, Fifth Third Bancorp, J.P.Morgan Chase & Co., KeyCorp, Northern Trust Corp., PNC Financial Services, Regions Financial Corp, State Street Corporation, SunTrust, U.S. Bancorp, Wells Fargo & Co..
Within the last 12 months, Morgan Stanley has received compensation for products and services other than investment banking services from American Express Company, Bank of America, Bank of New York Mellon Corp, BB&T Corporation, Capital One Financial Corporation, Citigroup Inc., Fifth Third Bancorp, J.P.Morgan Chase & Co., KeyCorp, Northern Trust Corp., PNC Financial Services, Regions Financial Corp, State Street Corporation, SunTrust, U.S. Bancorp, Wells Fargo & Co..
Within the last 12 months, Morgan Stanley has provided or is providing investment banking services to, or has an investment banking client relationship with, the following company: American Express Company, Bank of America, Bank of New York Mellon Corp, BB&T Corporation, Capital One Financial Corporation, Citigroup Inc., Discover Financial Services, Fifth Third Bancorp, J.P.Morgan Chase & Co., KeyCorp, Northern Trust Corp., PNC Financial Services, Regions Financial Corp, State Street Corporation, SunTrust, U.S. Bancorp, Wells Fargo & Co..
Within the last 12 months, Morgan Stanley has either provided or is providing non-investment banking, securities-related services to and/or in the past has entered into an agreement to provide services or has a client relationship with the following company: American Express Company, Bank of America, Bank of New York Mellon Corp, BB&T Corporation, Capital One Financial Corporation, Citigroup Inc., Discover Financial Services, Fifth Third Bancorp, J.P.Morgan Chase & Co., KeyCorp, Northern Trust Corp., PNC Financial Services, Regions Financial Corp, State Street Corporation, SunTrust, U.S. Bancorp, Wells Fargo & Co..
Morgan Stanley & Co. Incorporated makes a market in the securities of American Express Company, Bank of America, Bank of New York Mellon Corp, BB&T Corporation, Capital One Financial Corporation, Citigroup Inc., Discover Financial Services, Fifth Third Bancorp, J.P.Morgan Chase & Co., KeyCorp, Northern Trust Corp., PNC Financial Services, Regions Financial Corp, State Street Corporation, SunTrust, U.S. Bancorp, Wells Fargo & Co..
The equity research analysts or strategists principally responsible for the preparation of Morgan Stanley Research have received compensation based upon various factors, including quality of research, investor client feedback, stock picking, competitive factors, firm revenues and overall investment banking revenues.
Morgan Stanley and its affiliates do business that relates to companies/instruments covered in Morgan Stanley Research, including market making, providing liquidity and specialized trading, risk arbitrage and other proprietary trading, fund management, commercial banking, extension of credit, investment services and investment banking. Morgan Stanley sells to and buys from customers the securities/instruments of companies covered in Morgan Stanley Research on a principal basis. Morgan Stanley may have a position in the debt of the Company or instruments discussed in this report.

For Adrianne Shapira
(TGT), (WMT), (KR), (SWY), (COST) Are Clients Of Goldman Sachs
(TGT), (WMT), (KR), (SWY), (COST) Received Non-Investment Banking Securities Related Services, Non-Securities Services From Goldman Sachs In Past 12 Months
(TGT), (WMT), (KR), (SWY) Received Investment Banking Serviecs From Goldman Sachs In Past 12 Months
Goldman Sachs Received Compensation From (TGT), (WMT) , (KR), (COST), (SWY) In Past 12 Months

For Mike Khouw
Cantor Fitzgerald and Co is a market maker in (AAPL)
Cantor Fitzgerald and Co is a market maker in (VZ)

For Romit Shah SOT
Nomura Securities Inc. is a market maker in (AMD)

For Dennis Gartman SOT
Funds Managed By Dennis Gartman Were Short The Euro on 1/10/2011

For Craig Berger
FBR Capital Markets & Co is a market maker in (INTC)
FBR Capital Markets & Co is a market maker in (NVDA)

GE is the parent company of CNBC
NBC Universal is the parent company of CNBC

CNBC.com and wires