Word On The Street
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Apple 3G iPhone Take
Gene Munster, Piper Jaffrey Managing Director, joined the traders to discuss his take on Apple Computer’s (AAPL) new 3G iPhone. Munster thinks the new iPhone is going to change the entire wireless world by becoming the mobile 2.0 application consumes will love. He predicted that Apple will sell 425,000 handsets around the world on Friday. He thinks the iphone will contribute big to Apple’s bottom line and move the stock considerably. Munster also sees the new phone spurring more Mac sales which will boost revenues in the future. The new iPhone will go on sale for $200 while an upgraded version will sell for $300.
Genentech Earnings Trade
Biotech giant Genentech (DNA) is set to report earnings on Thursday. What is the trade? Mike Huckman, CNBC’s Pharmaceuticals Reporter told viewers that Genentech will need to beat $645 million in Avastin sales to move the stock. Najarian said DNA has already run up 10 points in the last month, so he would wait for a pull back before jumping in. He also advised investors to watch Elan (ELN) for its Alzheimer’s drug. Adami recommenced Celgene (CELG).
Best of Breed – Technology
Guy Adami thinks Coring (GLW) is a best of breed technology stock and should be bought at current levels. He said GLW trades at only 11 times forward earnings which is cheap. Adami explained that the LCD market is growing like gangbusters and Corning controls 58% of the market share for the LCD sector. Merill Lynch (MER) also upgraded the stock on Thursday.
Family Dollar CEO Interview
Howard Levine, CEO of Family Dollar (FDO) joined the traders to discuss his company’s prospects. Levine said the retail space remains challenging and customers aren’t spending on discretionary products. Despite the tough times, Levine pointed out that his company is doing better than most retailers because they’ve unique products like the Bugle Boy apparel line. “We’re seeing some benefit from the stimulus checks and the warmer weather that hit late June and early July. But what we’ve seen is that people are focused on consumable and we’ve tried to leverage that,” he said. Adami said he wouldn’t play this stock. Najarian said he doesn’t see how FDO can compete with Wal-Mart (WMT).
Trader Radar
Shares of Ruby Tuesday (RT) were among the most actively traded stocks on the NYSE Thursday.
POPS&DROPS
POPS- SunPower Corporation (SPWR) shot up 14% after the alternative energy company announced plans to build 2 solar power plants for Florida Power & Light. Najarian said he likes SPWR. Shaw Group ( SGR) advanced 10% after the company beat third-quarter earnings estimates. Najarian said the company has a $16 billion backlog, which is impressive. DaVita (DVA) rose 7% on no news. Finerman said the stock used to be undervalued but not now.
DROPS- Marriott International (MAR) fell 7% after the hotel chain said second-quarter earnings fell 24%. Adami said they are a victim of the economy. J.C. Penney ( JCP) dropped 10% after the retailer said June same-store sales fell 2.4%. Finerman explained that department stores are having a tough time right now. NYSE EuroNext (NYX) slid 2%. Adami said everything seems to be going right but not for their stock price. InterContinental Exchange (ICE) plunged 10% after legislators questioned how much the commodities exchanges have control over futures prices. Macke said he wouldn’t touch ICE with the government getting in their business. Cox Radio (CXR) dropped 9% after Citigroup downgraded the company to sell from hold. Adami said more people are using iPods over listening to the radio.
Final Trade
Macke picked United States Oil Fund (USO). Adami picked Alcoa (AA). Finerman said short Big Lots (BIG). Najarian likes Cisco Systems (CSCO). 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!