Here Come the Buys - Fast Money Recap (5/1/08)

Recap of CNBC's Fast Money, Thursday May 1. Click on a stock ticker for more analysis.

Aubrey McClendon CEO Chesapeake Energy (CHK) McClendon said his company trades at a discount and he is an aggressive buyer of CHK stock. He predicted the stock price could double and said the company is not hurt by volatility in commodities because it is hedges against downside risk in the price of natural gas. Since he has a large stake in his company, he is unwilling to stop hedging.

Intel (INTC), Cisco (CSCO), Goldman Sachs (GS), Wachovia (WB), Google (GOOG), Apple (AAPL), Microsoft (MSFT), Financial Select SPDR (XLF)

The six-month trend of commodities outperforming the tech and financial sectors seems to be reversing and Adami thinks investors are leaving commodities. His picks include INTC, GS, CSCO and WB. Macke agrees and would wait for drops to buy. He doesn’t think there is any reason to short financials. He would buy MSFT on upcoming noise about the stock and would wait for XLF to drop another 4% before buying. Najarian thinks tech is accurately valued and has seen some upside from Google and Apple, while financials are currently undervalued.

Jobs Report

David Kelly of JPMorgan funds said although slow GDP growth may mean an increase in unemployment, the jobs number is a lagging economic indicator and if retail sales rise and housing looks better, the market could be insulated. Kelly thinks there might be some volatility on the jobs report, but the credit storm, which has been the cause of uncertainty and panic, is giving way to an economic storm, which the market can more easily handle because such storms have been more frequent. Adami agreed that while the jobs number could be bad, it is a lagging indicator. Adami predicts the GDP could rise 3.5% on stimulus checks and Kelly thinks most of these checks will be spent on consumer goods and will give a boost to the economy. Finerman agreed with Kelly’s distinction between the credit crisis and the broader economy.

Earnings Lessons

Adami says the recent earnings season has shown that stocks can rise in spite of bad numbers. He noted that many stocks were sold prior to earnings reports, so the reports did not have as negative an effect as many feared. Finerman noted that expectations in general were low. Macke predicts “horrible” earnings from retail, and would buy these stocks on dips.

Here Come the Buys - Wedding Season Picks: Costco (COST), Wal-Mart (WMT), Tiffany (TIF), Williams Sonoma (WSM), Blue Nile (NILE)

Given the state of the economy, it is no longer a faux pas to purchase bridal gifts from lower-end retail stores, and Macke would buy WMT, which is seeing more activity in its bridal registries, and Costco. He would not consider buying higher-end names, such as TIF, WSM and NILE now.

Final Trade: Macke: Short Dow30 ProShares (DOG), Adami: Cisco (CSCO), Najarian: American Express (AXP)

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Comments

[tom1234]

i ask the fab five @fast money---last oct/nov aapl was $200.00 ---since then more products came out --more products are coming out ---greater (profit) money is and will be made ---PLUS APPLE IS DEBT FREE----so is not $200.00 per share a number to pass on the way to $$$$$ the real value