Word On The Street
WORD VIDEO HERE
RIMM Trade
Research In Motion (RIMM) reported a higher first-quarter profit, but the shares plunged after the company’s guidance missed Wall Street estimates. Najarian said now is a great opportunity to buy this stock and he disclosed he will be adding to his position tomorrow. He noted the company added 2.3 million new subscribers without bringing out some of its new releases.
Dennis Gartman
The traders spoke with Dennis Gartman, author of The Gartman Letter, about his take on the Fed and commodities. Gartman said the Fed’s action was already priced into the market so he doesn’t see anything happening to commodities. He said its as if no meeting even took place and the market is back to where it was 5 days ago. Gartman noted that oil, gold and the grains all closed strong today and the dollar closed on a weak note. He disclosed he is long a little bit of gold and thinks it will be strong tomorrow. Gartman also said to buy coal on weakness and he advised investor not to short the coal stocks.
Aerospace Trade
Goldman Sachs Group (GS) downgraded Boeing (BA) to sell from neutral and added the stock to its conviction sell list. The traders spoke with Clayton Jones, CEO of Rockwell Collins (COL) about the airline division of his company. Jones explained that only 27% of Rockwell’s revenues come from Boeing and Airbus. He said that the rest of the company’s business segments like defense and business jets are strong and the market is way over playing Rockwell’s exposure to commercial airlines. Jones explained that the stock market is not rational in the short term and he will continue to run his business like they’ve done for the last 6 years – increase operating margins and increase return on investments. Adami said the stock is cheap on valuation and he loves the name. Finerman said she isn’t sure cause you can’t ignore oil.
Election Drug Trade
The traders discussed the which drug stocks would work under a McCain or Obama presidency. Najarian said if McCain wins buy Merck (MRK) and if either candidate wins Novartis (NVS) will work. For an Obama win he suggests Cepheid (CPHD), Myriad Genetics (MYGN) and Immucor (BLUD).
Cyberonics CEO Interview
Daniel Moore, CEO of Cyberonics (CYBX) joined the traders to discuss his company’s prospects. Moore explained that he brought CYBX into the green by cutting costs and expanding its epilepsy business. He explained that the technology the company sells is an implantable generator that sends electronic pules to the brain to treat epilepsy. The product helps to reduce the frequency of seizures. Finerman disclosed that her hedge fund has a large position in CYBX. Najarian said the company is very interesting.
Refiner Trade
Najarian told viewers that he has noticed a lot of insider buying in Tesoro (TSO) and heavy call options trading on the name. He explained that if oil falls the crack spread will widen and refiners should make more money. Terranova said stay away from the refiners. He mentioned that if oil drops the refiners wont be good plays because their inventories are too high. Finerman noted that she has also seen the insider buying in the refiners, but she doesn’t love the price action the sector.
POPS&DROPS
POPS- Barclay’s (BCS) traded up 5% after the bank said it plans to raise $8.85 million. Adami said avoid this stock. Pier 1 (PIR ) traded up 6% after the company dropped its bid to buy Cost Plus. Finerman joked its troubling when a stock goes up for not doing a takeover. Darden Restaurants (DRI) traded up 7% after the company beat earnings estimates. Terranova said if it drops below $30 get out. Ashland (ASH) moved up 9% after JP Morgan upgraded the stock to neutral from underweight. Luxottica (LUX) jumped 9% after the reaffirmed its 2008 outlook. Finerman said the stock had a relief rally. Nokia (NOK) added 6% off a strong earnings report from supplier Jabil Circuit (JBL). Najarian said about time Nokia started moving. Jabil Circuit (JBL) soared 16% after the component maker beat Wall Street profit expecations. Najarian said. that anything in this sector is doing great today. Winn-Dixie (WINN) surged 13% after Friedman Billings & Ramsey upgraded the stock to outperform from market perform. Terranova said the stock is heavily shorted and has more room to the upside.
DROPS- Massey Energy (MEE) fell 2% after the Wall Street Journal said coal producers can’t keep up with booming demand. Najarian said the pull back isn’t that bad. Rockwell (ROK) fell 12% after the company lowered its third-quarter earnings outlook. Adami said the stock hit a 52-week low today. XTO Energy (XTO) dropped 4%. Terranova said wait and see before jumping back in XTO.
Fast&Furious
Lennar (LEN) is set to report earnings before the market opens on Thursday. Adami advised investors to stay away. Discover Financial (DFS) will report earnings before the bell tomorrow. Finerman said take a look at MasterCard (MA).
Trader Radar
Shares of American Greetings (AM) were among the most actively traded stocks on the NYSE Wednesday.
Final Trade
Terranova picked Freeport McMoRan (FCX). Adami selected AT&T (T). Finerman recommended Microsoft (MSFT). Najarian said he’s bullish on Nokia (NOK). Get the scoop on tomorrow’s hottest trade ideas – TODAY! BeaconEquity.com PREMIER PICKS have an amazing track record. Join this select group and ride the profit wave!