With shares of Microsoft down nearly 10% over the past 3 months, how should you game this stock into – and in the wake of – earnings.
Seems like a good time for Fast Money 360.
Find out what fundamentals, technicals and insights from the options world all suggest lie ahead for this stock.
FUNDAMENTALS
BGC analyst Colin Gillis thinks Microsoft has upside, in part because of the stronger than expected earnings recently released by PC chip maker Intel.
”Microsoft shares have been trading down on the quarter in what we are calling the IDC trade,” he says. (That is, the recent reports which have suggested the PC market is falling apart).
However Gillis thinks the death of the PC is overstated. “We saw it with Intel when they reported and we are going to see it again with Microsoft,” he adds. “We’re buyers of Microsoft headed into the report on Thursday.”
TECHNICALS
Oppenheimer’s Carter Worth is also bullish.
”A lot of big cap tech names have been dormant into earnings, then they’ve popped,” he says. “We think Microsoft will do just that.”
In other words, he thinks the trade is long. ”We like it here. We are buyers of Microsoft going into earnings.”
OPTIONS
Scott Nations NationsShares says options traders are also buyers.
”12 of the 15 most actively traded options are calls." And among the most active "the weekly 26 calls,” he says. “And the May 27 calls are active also.”
”So options traders on Microsoft are bullish going into the earnings,” he concludes.
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Trader disclosure: On April 27, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders Karabell owns (AAPL); Karabell owns (CSCO); Karabell owns (GE); Karabell owns (GOOG); Karabell owns (IBM); Finerman and Finerman's firm own (AAPL); Finerman and Finerman's firm own (BP); Finerman owns (C); Finerman and Finerman's firm own (CVS); Finerman's firm owns (IBM); Finerman's firm owns (JPM) and (JPM) leaps; Finerman owns (JPM); Finerman and Finerman's firm own (MSFT); Finerman's firm owns (TGT); Finerman owns (UNG); Finerman owns (USO); Finerman's firm is short (IWM), (MDY), (SPY); Finerman's firm is long S&P 500 puts; Finerman's firm is long Russell 2000 puts; Grasso owns (AMD); Grasso owns (ASTM); Grasso owns (BA); Grasso owns (BAC); Grasso owns (C); Grasso owns (CSCO); Grasso owns (JPM); Grasso owns (FITB); Grasso owns (LIT); Grasso owns (LPX); Grasso owns (MHY); Grasso owns (NDAQ); Grasso owns (PFE); Grasso owns (PRST)
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