'Fast Money' Recap: Dell's Big Surprise

Jim Goldman said Dell surprised analysts when it exceeded their revenue and earnings estimates.
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NEW YORK (

TheStreet

) -- The markets scratched out a gain Thursday on light volume.

The

Dow Jones Industrial Average

rose 37.11, or 0.39%, to 9580.63, while the

S&P 500

was up 2.86, or 0.28%, to 1030.98. The

Nasdaq

added 3.30, or 0.16%, to 2027.73.

Jim Goldman said on

CNBC

's "Fast Money" TV show shares of

Dell

(DELL) - Get Report

were up in after-hours trading after it delivered a "one-two punch" when it beat analysts' expectations on revenue and earnings.

He said the company benefitted from cost-cutting and improving business conditions. He said gross margins were 18.7%, a full percentage point above analysts' expectations.

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 onTV

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Goldman said CEO Michael Dell was pretty optimistic on the conference call. He said Dell believes customers will fall in love with PCs again and anticipates a "big refresh" through the balance of 2010 that will come from a new product cycle that includes Windows 7 and a new processor from

Intel

(INTC) - Get Report

.

Guy Adami was impressed with Dell's earning report. However, he said it's time to get out of the stock and move into

Hewlett Packard

(HPQ) - Get Report

, which he said is "much cheaper."

Pete Najarian said he isn't surprised that people are saying the market has "stalled." He said they should realize the S&P has gone up 400 points in the past quarter. Joe Terranova said the market is trading perfectly, bouncing back after the hitting the resistance level of 1010.

Rick Santelli, the moderator of the show, said oil reversed today, ending up 1.5 percent. Terranova reiterated his trade of buying oil on dips. Steve Cortes, however, said any trades in oil are meaningless until it gets above $75. Cortes said the lagging China trade is telling him to get off this trade.

Cortes said the way to trade the lagging materials and resources stocks is to short the

Materials Select Sector SPDR

(XLB) - Get Report

against the S&P.

Najarian said he would take any opportunity to pick up the coal names on a pullback. And Adami said he liked

Eastman Chemical

(EMN) - Get Report

, which he says is cheap on valuation.

Santelli asked the panel what they thought of

AIG

(AIG) - Get Report

, which was up 27% today.

Najarian said he had his eye on

MBIA

(MBI) - Get Report

, the target of heavy call activity. Adami said he would take profits on

Hartford Financial

(HIG) - Get Report

and pick up

Rockwell Collins

(COL)

.

Shifting to the Treasury auction of 7-year notes, which went well today, Cortes said he's impressed with how well the

iShares Barclays 20+

(TLT) - Get Report

is faring against the

S&P 500

(.SPX)

. Najarian said he understood that trade because investors are chasing less risky investments, including stocks with attractive dividend yields like telecoms.

CNBC

editor Charlie Gasparino said Andrew Hall's controversial $100 million compensation package has become a nightmare for

Citigroup

(C) - Get Report

and could lead to a restructuring of the unit he was working in.

Santelli invited Shane Kim, vice president for

Microsoft

's

(MSFT) - Get Report

XBox business strategy, to comment on reports that Microsoft is cutting the price of its xBox video game system to spur sales.

Kim said the price cuts are designed to offer more value to its customers and attract more people to the Xbox entering the holiday season. He said the company has reduced the price of the xBox 360 elite to $299.

He said the xBox offers the leading online gaming service to its customers. He also said Microsoft is expanding its entertainment and social experiences on the video gaming system.

Adami said he preferred

Electronic Arts

(ERTS)

on the belief that someone is going to gobble it up. Cortes added Microsoft needs to buy a company because it can't do it with internal growth.

Is tech heading for a fall? Not according to Najarian who believes big-cap names such as

Cisco

(CSCO) - Get Report

have done a good job of cost-cutting and have a lot of cash in reserves.

Is the market rally a fake? Bob Pisani, a

CNBC

editor, said the market is churning along on low volume, waiting for more clarity on the health of sectors such as housing. He said it's difficult to evaluate the state of housing when there are foreclosure moratoriums and a federal mortgage subsidy propping it up.

Jon Najarian said

Apple

's

(AAPL) - Get Report

iPhone launch will go very well because the Chinese consumer is very brand conscious and will pay full price.

In the final trades, Terranova said it's time to buy gold

. Najarian said he liked MBIA. Adami and Cortes did not have picks.

-- Written by David Tong in San Francisco

"Check out

"'Fast Money'Portfolios of the Week" on Stockpickr every Thursday.

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