Resist Temptation, Don’t Buy Wal-Mart Weakness: Kelly

With business practices at Wal-Mart being called into question, you're probably wondering how to trade the retailer’s stock, especially after Monday's sharp pullback.

Warren Buffett likes to say be greedy when others are fearful; however, given these extenuating circumstances, does that axiom even apply?

As you likely know, Wal-Mart's big decline was triggered by aNew York Times report that said the company violated the Foreign Corruption Practices Act by paying off Mexican officials who oversaw the company's expansion plans.

That sounds pretty serious. What should you do?

“I don’t see how this can be anything but an overhang,” says Fast Money trader Brian Kelly. He tells us he can’t make any compelling case for pulling the trigger. “You could wake up one morning and find out the story is worse, much worse. I’d just stay far away. There are plenty of other places in retail that you can put money to work.”

If you’re looking for a retail trade, money pro Mike Murphy says check out the dollar stores on Monday’s weakness.

Last year, in the face of economic weakness, dollar stores won audience away from Wal-Mart. If investors pull money out of Wal-Mart but want to stick with the same theme, that money could go into dollar stores.

“Generally, dollar stores may be a great place to play,” Murphy says.

* You can find our Wal-Mart conversation about 10 minutes into this video clip.



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Trader disclosure: On Apr 23, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Joe Terranova is long VRTS; Joe Terranova is long MCD; Joe Terranova is long JOY; Joe Terranova is long HPQ; Joe Terranova is long LQD; Joe Terranova is long JPM; Joe Terranova is long NXPI; JJ Kinahan is long AAPL Options; JJ Kinahan is long C; JJ Kinahan is short GS puts; JJ Kinahan is short WFC puts; JJ Kinahan is long TLT; JJ Kinahan is long CSCO; JJ Kinahan is short YHOO puts; JJ Kinahan is short SPY; Mike Murphy is long BAC; Mike Murphy is long JPM; Mike Murphy is long INTC; Mike Murphy is long ANF; Mike Murphy is long SBUX; Mike Murphy is long FCX; Mike Murphy is long PHM; Brian Kelly is long LWM; Brian Kelly is long KRE; Brian Kelly is long USG; Brian Kelly is long BUNDS; Brian Kelly is short EWW; Brian Kelly is short FTSE 100; Brian Kelly is short EURO STOXX BANKS; Brian Kelly is short YEN

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