Word On The Street
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Apple Upgrade
Goldman Sachs Group added Apple Computer (AAPL) to its Americas Conviction Buy List and analyst David Bailey raised his price target on the stock to $220 from $185, citing aggressive international expansion. What is the trade? Najarian said buy Apple ahead of the new iPhone release, but sell after that event. He said watch for a developers conference on June 9th where Apple should annoucne when the release date of the new 3G phone.
Financial Take
David Einhorn, president of Greenlight Capital said Lehman Brothers (LEH) needs to write down more bad mortgages and raise more capital. Einhorn’s comments took down the Financial Select Sector SPDR (XLF) and shares of Lehman. What is the trade? Najairan said he is noticing unusual put trading in Lehman that suggests to him the stock could go lower. Macke said avoid the XLF its too scary.
Summer Trade -Beer Plays
On Friday, Anheuser-Busch (BUD), the maker of Budweiser, jumped 7% after speculation swirled around Wall Street that InBev might make a takeover offer for $65 a share. Following the news, the traders took a look at some beer stocks that could work for a summer trade. Adami said look at Boston Beer (SAM) for a trade. Macke picked Molson Coors (TAP). Seymour recommended Companhia de Bebidas das Americas (ABV).
CEO Interview
EVERGREEN SOLAR CEO INTERVIEW VIDEO
Fast Fire
Adami told viewers to buy FedEx (FDX). He was wrong and the stock fell 11% from his call. Seymour recommenced shares of Genco (GNK), but the stock didn’t cooperate dropping 17% from his call. Despite the big drop, Seymour said buy the stock on a dip. Najarian advised investors to buy Masco (MAS). He was way off on the call and MAS dropped 9%. He now thinks investors should sell the stock. Recently, Macke said buy Hasbro (HAS), but shares fell 7% from the time of his pick. Macke responded to the bad call by saying the stock is a long-term trade.
POPS&DROP
POPS- Foot Locker (FL) traded up 13% after the CEO made bullish comments about the company’s prospects for next year. Coca-Cola (KO) popped 3%. Seymour said he likes the stock for a play Memorial Day weekend.
DROPS- The airline sector dropped 20% in the face of record crude oil prices. Najarian said trade it for a quick pop. Home Depot (HD) dropped 8% after the company said profits fell 66%. Adami said buy HD on a dip. Moody’s (MCO) plunged 24%. Macke said the company needs to justify its existence. China Mobile (CHL) moved down 9% after the Chinese government forced the company to take over a slow-growing fixed-line carrier. Seymour doesn’t like the idea. Chesapeake Energy (CHK) lost 11%. Najarian explained that CHK is diluting shareholders by issuing debt. JPMorgan (JPM) dropped 9%. Adami said he likes the stock at $41.
Quicker Than The Ticker
Macke picked the United States Oil Fund (USO). He was right and the USO jumped 11% from his call. Najarian selected Anheuser-Busch (BUD). He was on the money and BUD lifted 16% from his call. Recently, Adami said buy Western Digital (WDC). He nailed the call and WDC soared 20% from his call. During the first week of May, Seymour told investors to buy Market Vector Russia ETF (RSX). He was dead on and the RSX rose 11% from his call.