'Fast Money' Recap: Green Mountain Coffee Stumbles

The trading panel discussed the impact of a SEC inquiry into revenue recognition issues at the company.
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NEW YORK (

TheStreet

) -- The markets bounced back Tuesday after shrugging off some disappointing economic data.

The

Dow Jones Industrial Average

gained 46.10, or 0.43%, to 10,058.14. The S&P 500 gained 5.54, or 0.48%, to 1,147.70, while the

Nasdaq

added 9.82, or 0.41%, to 2,379.59u.

Joe Terranova said on

CNBC

's "Fast Money" show that

Hewlett-Packard

(HPQ) - Get Report

was gaining some "positive" momentum after the loss of Mark Hurd to

Oracle

(ORCL) - Get Report

.

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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Melissa Lee, the moderator of the show, said the company was making news in the afterhours after it raised revenue and EPS estimates for 2011. The stock was more up 2%.

Guy Adami said one has to like HP's valuation at this point, especially with today's strong tape and market closing. He said the stock has been on a bit of a run and told investors to wait for a pullback before getting in.

Brian Kelly said he was staying from the stock because HP has some integration issues to deal with. He also wondered what the next catalyst will be for the tech stocks.

Pete Najarian said he feels HP will be able to find an internal candidate to become CEO and continue the acquisition strategy that Hurd left behind.

Terranova said the missing catalyst that Kelly alluded to might the weak dollar. He said tech companies do well in such an environment.

Lee noted that

Green Mountain Coffee

(GMCR)

, which had been on a tear, was down 10% in afterhours trading after it noted the SEC was conducting an inquiry into revenue recognition issues.

Terranova immediately called the news a "game changer" and advised investors to hedge their exposure. Adami said the shorts will lay into the stock on Wednesday. And Najarian advised buying some put protection in the stock.

Herb Greenberg,

CNBC

senior stocks commentator, said there had been some negative commentary ahead of today's news, in which some Wall Street firms questioned its business model and decisions to acquire licensees. He said these rumblings were downplayed because anyone questioning the company would have looked "foolish."

Adami noted that the nine analysts who follow the stock will have something to say about it Wednesday. Terranova said the stock's appreciation has been a proxy for the runup in coffee futures.

Lee said

Apple

(AAPL) - Get Report

was hit on rumors that its COO Tim Cook, the heir apparent to Steve Jobs, might be in line for the CEO position at HP.'

Kelly said the market was doing well until the Apple rumor. He said something is "wrong" when one stock, although it represents 20% of the Nasdaq's market cap, can have that much influence on the general markets.

Weiss said his iPhone play was with

Verizon

(VZ) - Get Report

, which he said he will do well when it gets the smartphone.

Lee said

Research and Motion

(RIMM)

was another loser today, as its PlayBook announcement isn't going over as well as expected.

Kelly attributed it to poor timing. He said the scheduling of the release of PlayBook in the first quarter coincides with the Consumer Electronics Show, where there will be many other tablets coming coming out.

Terranova reiterated his support for the stock. He said RIM's tablet is all about providing a product that has features that the iPad doesn't have.

Commenting on the rise in cloud stocks today, Najarian said stocks such as

Rackspace Hosting

(RAX)

and

NetApp

(NTAP) - Get Report

have risen so high that they are getting priced out of being an acquisition target.

Terranova mentioned an under the radar software pick, when he noted

SuccessFactors

(SFSF)

, a management software company that is enjoying bookings growth of more than 20% and is expanding into Europe and Japan.

Shifting to the casino stocks, Najarian said he liked

Las Vegas Sands

(LVS) - Get Report

more than

MGM Resorts

(MGM) - Get Report

because of the growth of its Macau gambling operations.

Banks were highlighted in the buzz kill segment, with

Goldman Sachs

(GS) - Get Report

and

Morgan Stanley

(MS) - Get Report

the weakest of the financials, Lee said.

The financials were not helped by the negative comments from analyst Meredith Whitney, who said she would not own any regional bank. Kelly said he didn't see any shift in direction of these depressed stocks until a market rally.

Commenting on the gold rally which vaulted above the $1,300 mark today, Rich Ilczyszyn, of Lind-Waldock, sees a 2% to 5% correction ahead to $1,240. He recommended taking some money off the table and hedging the downside risk. He put out the same cautionary advice for silver, which has reach a 30-year high.

Looking at the broader market, Carter Worth, chief market technician at Oppenheimer Asset Manager, said though the S&P has gone above its June and August tops, the Russell 5000 and Dow Transportation indexes have not. He called it a "critical point" for the market.

Shifting to oil, Terranova argued there is a reason to be in it for seasonal reasons. He said oil will benefit in October from the shift from gasoline to heating oil. Weiss said he liked the natural gas play. He sees it rising, especially if there is enough political will to muster up an energy policy, with natural gas as a leg.'

In the "ear to walls" segment, David Sackler, co-portfolio manager of Moab Capital Partners, pitched

Regis

(RGS) - Get Report

, a large company that maintains hair salon franchises and training schools.

He said the stock is "dirt cheap" and generates a lot of cash. He said the company recently said it is considering putting itself up for sale, which he predicts would fetch a price from $22 to $27 a share. He also speculated that a private equity firm might be interested in buying it.

Shifting to health care stocks, Weiss said stocks like

Merck

(MRK) - Get Report

and

Pfizer

(PFE) - Get Report

continue to do well. He said these stocks are playing a bit of catch up and should benefit from any changes in the health care reform law should the Republicans get the upper hand in the November elections.

Terranova said his pick in this space was

Intuitive Surgical

(ISRG) - Get Report

.

In the final trades, Weiss liked

Petrohawk

(HK)

. Kelly liked

Allegheny Tech

(ATI) - Get Report

, while Adami liked

Pan American Silver

(PAAS) - Get Report

. Terranova liked

Hess

(HES) - Get Report

, while Najarian's pick was

Diamond Offshore

(DO) - Get Report

.

--Written by David Tong in San Francisco.

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David Tong.

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.

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