'Fast Money' Recap: Merger Buzz

NEW YORK ( TheStreet) --

The markets were mixed Monday on renewed concerns of the eurozone debt crisis.

The Dow Jones Industrial Average fell 37.31, or 0.32%, to 11,637.45, while the S&P 500 slipped 1.75, or 0.14%, to 1,269.75. The Nasdaq added 4.63, or 0.17%, to 2,707.80.

Brian Kelly said on CNBC's "Fast Money" TV show said Nvidia ( NVDA) rose 8.6% in afterhours trading on news that Intel ( INTC) will pay it a $1.5 billion licensing fee to settle a legal dispute. Terranova said he expects a pullback in Nvidia stock in the next 10 days, adding that would be opportune time to buy the stock.

In the other big chipmaker news in afterhours, Advanced Micro Devices ( AMD) was falling after it was announced that its CEO Dirk Meyer had resigned.

Terranova said it was good for the board to address the problems, but Tim Seymour said it would be disastrous the board to leave the CEO position vacant without having a replacement in hand.

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

Craig Berger, an analyst for FBR Capital, said investors will probably be surprised by the move because Meyer had done a good job of dealing with the cost structure and the company's global foundry's deal.

On a day when its peers were down Apollo Group ( APOL) was up on higher tuition fees. Finerman said there are still some big questions lurking in the for-profit education industry, including the final rates from the government and passage of gainful employement rules.

CNBC senior stocks commentator Herb Greenberg said Apollo expects new enrollment to decline for the next two to three years.

Commenting on Alcoa's ( AA) better-than-expected earnings today, Kelly said the company was able to report a beat on earnings because it raised prices to cover higher input costs.

Melissa Lee, the moderator of the show, shifted to JPMorgan Healthcare Conference and brought in Human Genome Sciences ( HGS) CEO Thomas Watkins to talk about Benlista, which has the potential to be first new lupus drug in 50 years.

He said the FDA is expected to rule on the drug on or before March 20. He called it a multi-billion-dollar drug, with initial sales targeted to 250,000 patients in the U.S. He also said the drug will undergo tests for other auto-immune uses.

With Verizon ( VZ) set this week to announce that it will be a carrier for the iPhone, Jon Najarian said the biggest impact from a stock standpoint will be on Apple. He said Verizon still has to match AT&T's ( T) unlimited data plan to be competitive.

Terranova, though, said Verizon appears to be a winner having invested heavily in 3G and 4G.

Shifting to the retail sector, Lee brought in Andrianne Shapira, a Goldman Sachs analyst, who upgraded Target ( TGT) to a buy from neutral and downgraded Wal-Mart ( WMT) to a neutral from a buy.

She said consumer sentiment has shifted to a point where it favors mid-tier retailers and brands. She said middle income families probably have better opportunities with the payroll tax cut and improving payrolls. She said that situation favors a retailer like Target compared to Wal-Mart, which attracts a lower segment of the market.

Lee noted that $21 billion worth of merger activity were announced today. Finerman said the activity was a good sign for the markets because it was an expression of confidence. She said she was long Genzyme ( GENZ), a target of Sanofi-Aventis ( SNY).

The possible tie-up of Johnson & Johnson ( JNJ) and Smith & Nephew ( SNN) intrigued her the most because it made sense to her for the two to get together. She said Smith & Nephew, like most U.K. companies, is vulnerable to an acquisition move.

Lee brought in Betsy Graseck, a Morgan Stanley analyst, to discuss the outlook for Bank of America ( BAC) in the wake of last week's foreclosure ruling out of Massachusetts.

Graseck said her base case calls for reps and warranties costing the bank about $18 billion, and $25 billion to $27 billion in the worst case scenario.

She said the bank needs to get better in its credit card business, foreclosures and reps and warranties. She said the bank has to be careful of not dropping the ball on capital markets. And she said the bank will raise dividends later than its peers, probably in the third and fourth quarters.

In the tweet the street segment, Pete Najarian said there was a lot of discussion about bank stocks, including JPMorgan Chase ( JPM), a target of a lot of fear mongering. He said he feels the stock can move to the upside on more clarity.

With Apple hitting fresh highs today, senior options trade Michael Khouw said it might be worthwhile to capitalize on the potpourri of optimistic estimates and buy some puts in the stock. He said investors could buy the Apple weekly 340 puts for $2.80.

Shifting to the eurozone debt crisis, Sean Egan, president of Egan-Jones Rating Co., said European exports should benefit from a weaker euro. He liked two stocks especially in this situation: BMW ( BMWG) and Daimler ( DAI).

In the final trades, Kelly liked Oshkosh ( OSK). Seymour said to sell Mechel ( MTL) as steel companies are being hurt by high coal prices. Terranova liked Canadian Natural Resource ( CNQ). Finerman liked Daimler ( DAI) and Najarian liked Ciena ( CIEN).

--Written by David Tong in San Francisco.

To contact the writer of this article, click here: David Tong.

To follow the writer on Twitter, go to http://twitter.com/davidtong.

To submit a news tip, send an email to: tips@thestreet.com.

To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.

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

More from Jim Cramer

Finding Stocks Right for You: Cramer's 'Mad Money' Recap (Friday 8/25/18)

Finding Stocks Right for You: Cramer's 'Mad Money' Recap (Friday 8/25/18)

Replay: Jim Cramer on the Markets, 10-Year Yield, Oil Prices and Foot Locker

Replay: Jim Cramer on the Markets, 10-Year Yield, Oil Prices and Foot Locker

Video: You Could Live in a Ritz-Carlton or St. Regis Home

Video: You Could Live in a Ritz-Carlton or St. Regis Home

Jim Cramer: Intuit Had a Fantastic Quarter

Jim Cramer: Intuit Had a Fantastic Quarter

Jim Cramer on Foot Locker's Earnings: Nike Is a Buy

Jim Cramer on Foot Locker's Earnings: Nike Is a Buy