'Fast Money' Recap: Tech Plays, 2011 Media Picks
NEW YORK (
) -- Stocks finished Friday's quiet trading session on a mixed note with enthusiasm about strong earnings from the tech sector and fresh bank M&A tempered by resurgent concerns about eurozone debt.
The
Nasdaq Composite
rose 5 points, or 0.2%, to close at 2,643, boosted by above-consensus quarterly profit reports from tech bellwethers
Oracle
(ORCL) - Get Report
and
Research in Motion
(RIMM)
. The Nasdaq's intraday high of 2,651 touched levels the index hasn't seen since December 2007.
The "Fast Money" crowd jumped all over the tech rally on Friday, and some investing experts revealed their top stock picks for 2011, among them,
Time Warner
(TWX)
and
Coach
(COH)
and
Pfzier
(PFE) - Get Report
.
With the
Nasdaq
at a two-year high and
Oracle
(ORCL) - Get Report
hitting a 10-year high, is it too late to join the tech bandwagon?
Jon Najarian said there is no doubt that tech, and big-cap tech, in particular, is red hot, with
Take Two Interactive
(TTWO) - Get Report
hitting a two-year high, Oracle up another 4% on Friday and
Research in Motion
(RIMM)
also up during the week's last trading session, and he thinks Oracle and RIM both still have room to move up.
Guy Adami says Oracle is a great company, and even at the highest levels in 10 years, it still has room, up to $35. Yet he cautioned that with volume as high as it was on Friday, caution is needed. There's no doubt, though, that with operating margins of 44%, Oracle is continuing to do everything right.
The "Fast Money" crowd noted that even as tech surges, not all tech is created equal.
For a breakout of some stocks from a recent "Fast Money" TV show, check out Dan Fitzpatrick's "3 Stocks I Saw on TV."
3 Stocks I Saw on TV |
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Joe Terranova says he's looking for Oracle to continue above $35 to as high as $38, which is clearly attainable in 2011, but that the tech divide has never been more stark between those doing well and those not. On the "not" side are
Cisco Systems
(CSCO) - Get Report
and
Microsoft
(MSFT) - Get Report
.
The "Fast Money" crowd also note Oracle took direct aim at
Hewlett-Packard
(HPQ) - Get Report
during its earnings conference call, saying that HP servers are slow and expensive, and Oracle plans on taking share from SAP and HP. Does that mean HP is among the "not" tech stocks?
Karen Finerman says there's already so much bad news priced into HP that as the dominant player in servers, it's still in a formidable position, and there's potential upside since the bar is set very low for HP.
Joe Terranova says that even with the move in Research in Motion, it's a "not" tech stock for him, and he says "thanks, but no thanks." The company is moving from the mature to the emerging markets and that leads to margin erosion, which he says RIM is already seeing.
2011 Investing Themes
Hedge fund manager Anthony Scaramucci of Skybridge Capital revealed his top stock picks of 2011, and his top 3 stock picker's themes for the coming year.
Scaramucci's three big 2011 investing themes are re-flation, previous metals, and the continuing emergence of the middle class in the emerging markets.
For the re-flation play in 2011, Scaramucci likes Pfizer and
Altria
(MO) - Get Report
, with 5% and 6% dividend yields, respectively.
In precious metals, Scaramucci is a fan of
Novagold Resources
(NG) - Get Report
.
With the emerging markets continuing to grow, and a very large swelling of the middle class, Scaramucci said he's sticking with Coach as a luxury brand play in the EM.
Jon Najarian agrees with the Coach call, but thinks Pfizer is a place "where money goes to die." He says that it's fine if investors want to "hide out in Pfizer for the dividend," but he wouldn't go there.
Top Media Sector Picks for 2011
Top media sector picks for 2011 were also revealed by RBC Capital Markets analyst David Bank.
"Fast Money" host Melissa Lee notes the downward trend in media stocks recently, but Banks says that fundamentals have been good, and it's just the investing world gripped by fear that the world starts cutting the cord and stops watching traditional TV.
The RBC Capital Markets' analyst's top three media picks for 2011 are
Scripps Networks Interactive
(SNI)
,
Viacom
(VIA) - Get Report
and Time Warner.
Banks says that Viacom is the best long-term pick in media, at a very attractive level now and easily hitting $4 in earnings next year as well as easy multiple expansion. "This could be a $50 stock, no problem," the analyst says. Viacom closed at $38.61 on Friday.
Banks says that Time Warner is the best trade because its multiple has compressed dramatically and he expects a recovery that takes Time Warner shares easily into the high $30s. Time Warner closed on Friday at $31.51.
An unexpected stock picker showed up on Fast Money on Friday, Regis Philbin, to wish Guy Adami a happy birthday, but Regis also got in a stock pick, saying insiders tell him
Micron Technology
(MU) - Get Report
is a stock on the move.
Sara Lee
(SLE)
was a big mover on Friday near the close on news that it might be broken up.
Karen Finerman says it makes sense to break up the struggling Sara Lee, and private equity money will be looking to buy pieces. The
Wall Street Journal
reported that a Brazilian conglomerate is looking to take out Sara Lee.
Next Week's Trading
Going into next week's trading, the "Fast Money" crowd says to focus on
Nike
(NKE) - Get Report
earnings. Peter Najarian notes that the financial world was tweeting about Nike on Friday, and with Nike's move up recently, 20% off September lows, it's no surprise. Even with Nike trading at 22 times price to earnings (18 times forward earnings), Najarian thinks the stock is still trading at a reasonable level.
Karen Finerman says Nike is a little expensive for her stock tastes, even with its global exposure, and especially after the run the stock has had of late.
Guy Adami comes down on Najarian's Nike team, though, saying that margin and inventory trends look good and there's still room for upside.
-- Written by Eric Rosenbaum from New York.
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