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'Fast Money' Recap: Market Deflates, Netflix Inflates

Stocks in this article: NFLX JPM FSLR TAN EMB VMW CNG PNRA AAPL FB TSLA XYL BIDU TSO CMLS PH

NEW YORK (TheStreet) -- The S&P 500 finished flat as stocks consolidated after making record highs in the previous two trading sessions. 

Monday's big headline came after Netflix (NFLX) beat on earnings and quickly rallied towards $400 in the after-hours session. The stock is now up over 440% this year. On CNBC's "Fast Money" TV show, Guy Adami, managing director of stockmonster.com, cautioned investors to avoid initiating new positions at these levels.

Tim Seymour, managing partner at Triogem Asset Management, said that although its subscriptions continue to increase, the valuation has more than priced in all of the good news.

Pete Najarian, co-founder of optionMONSTER and tradeMONSTER, said international subscriptions are finally starting to grow and the current subscription number is just the tip of the iceberg. 

Mark Mahaney of RBC Capital Markets said four catalysts exist to drive shares of Netflix higher: cable distribution deals, (so far there have only been rumors), price hikes that will lead to better margins, swinging from a loss to a profit in its international division and producing another award-nominated series.

JPMorgan Chase (JPM) has reportedly settled with the Justice Department for $13 billion. Karen Finerman, president of Metropolitan Capital Advisors, said investors seem to have already priced the fines into the stock price. She still likes the stock.

Josh Brown, a financial adviser of Ritholtz Wealth Management, said he is still long First Solar (FSLR), but suggested investors use the Guggenheim Solar ETF (TAN) to minimize single-stock risk. The exchange-traded fund is invested in the 22 highest levered companies to the solar industry. 

VMware (VMW) beat earnings estimates, and Najarian suggested EMC (EMC) could also advance when it reports on Tuesday.  

Stephen Anderson, a restaurant analyst at Miller Tabak, was a guest on the show and downgraded shares of Chipotle Mexican Grill (CMG) to hold from buy. While he acknowledged the stock deserves a premium valuation, he said it will likely have a modest pullback. However, he said Chipotle is firing on all cylinders.

Adami said Panera Bread Company (PNRA) could shock Wall Street when it reports earnings on Tuesday because nobody seems to expect good results.

Apple (AAPL) will unveil its new iPad models on Tuesday afternoon. Seymour said the stock has technically broken out to the upside, while Najarian said he continues to like the stock. 

Dennis Gartman, publisher of The Gartman Letter, was a guest on the show and said crude oil could go down to $85 per barrel because the U.S. is producing so much oil. He added that refinery stocks should benefit from lower input costs and higher output volume. 

Najarian said he is a buyer of Facebook (FB) due to its momentum and incredible volume in the call options. Regarding earnings, he said investors could continue to own the stock if mobile growth remains strong. Otherwise, it should be sold.

Tesla Motors (TSLA) fell on Monday, but Adami said he doesn't consider the pullback a good buying opportunity for those who have yet to get long on the stock. 

Barbara Marcin of Gabelli was a guest on the show and said Xylem (XYL) is one of her favorite picks. Regarding Apple's new iPad, she said investors might expect colors and fingerprint sensors to go along with a thinner, lighter model. 

Finerman said small investors are unlikely to be allocated shares of Twitter when it goes public. If they do get shares, it's probably not a good thing.

Seymour said Baidu's (BIDU) recent acquisitions are good for the company and traders should watch how the stock trades over $160. He is not a buyer at these levels.

For their final trades, Finerman is a buyer of Cumulus Media (CMLS) and Adami is buying Parker Hannifin (PH). Seymour said to buy Tesoro (TSO) and Najarian is buying EMC.

-- Written by Bret Kenwell in Petoskey, Mich.

Follow TheStreet.com on Twitter and become a fan on Facebook. X

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.

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