'Fast Money' Recap: Cool on Intel

NEW YORK ( TheStreet) -- Intel's ( INTC) strong earnings and guidance was a bright spot on a down day for the markets on Thursday.

The Dow Jones Industrial Average fell 22.54, or 0.20%, to 11,731.90, while the S&P 500 dropped 2.20, or 0.17%, to 1,283.76. The Nasdaq lost 2.04, or 0.07%, to 2,735.29.

Pete Najarian said on CNBC's "Fast Money" TV show that the Intel's earnings report was impressive, with gross margins over 67% and a strong outlook for 2011.

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

Tim Seymour complained that Intel's stock hasn't performed well despite the earnings. He said the chipmaker has strategic long-term problems that it must resolve, including its failure in mobile and being shut out of the tablet movement. He said it needs to spend to get into the game.

Guy Adami said Intel has always struggled with the $22 resistance level.

Joe Terranova said the playing field has shifted in the chip sector to favor companies that are producing chips for tablets and smartphones. "You can have 80% of the chip market, but if you are in the wrong market, that's a problem."

Najarian defended Intel, praising its purchase of McAfee and its Sandy Bridge platform.

CNBC reporter Brian Schachtman spoke with Intel CFO Stacy Smith after the earnings report. Smith said he sees no near-term impact from Microsoft's ( MSFT) decision to shift to another chipmarker for its Windows program. Smith also said tablet sales are not having an impact on the PC market.

Shifting to Microsoft, hedge fund manager Whitney Tilson had high praise for the company's business, noting 80% of its sales are to businesses. He said the company's earnings are going to be "gangbusters" from the sales of Windows 7, which, he said, are about to take off.

With market volatility below 17, Najarian said it's smooth sailing for the markets unless problems surface in China or the eurozone countries.

Shifting to the boom in soft commodity prices, Seymour said fertilizer demand remains strong, though he cautioned about a bubble in the coal stocks.

Ann Duignan, an analyst for JPMorgan, commented on her upgrade of Deere ( DE). She said the demand for equipment is growing because there are lower inventories in every commodity, including butter and bananas.

She said it is going to a banner year for U.S. farmers, with several years ahead of increased crop production.

Shifting to the retail sector, Target ( TGT) worked out a deal with Hudson's Bay Co. to pick up the leases of 276 Zeller stores in Canada. Target plans to open 150 Target stores in 2013 and 2014.

Colin McGranahan, an analyst for Sanford Bernstein, said Target has been contemplating the move for some time and now it's getting into Canada in a "big way." He said the deal is structured interestingly so that Target can pick and choose which of the 150 Zeller stores it wants.

Adami said the Canadian expansion was a good move and advised investors to get into the stock on a pullback. Terranova said Target has moved ahead of Wal-Mart because its management team has come in with new ideas and cleaned up the operations.

With JPMorgan ( JPM) reporting its earnings Friday, Tim Seymour said he expected its earnings to be "fantastic." He also liked the prospects for growth of Bank of America ( BAC) in the capital markets. He was skeptical of Citigroup ( C), saying it was narrowing its business, after selling off the best parts of its operations.

Tilson returned to the show to comment on the ailing housing industry, which he said is now in the seventh inning.

He said the situation is an "enormous complicated mess" that is "certainly not going to get better." However, he said the federal government is supporting the industry by helping keep interest rates low. He also said it makes no sense from a financial and societal perspective for banks and services to resort to foreclosure as a first option instead of helping homeowners work out their problems.

He remains short on homebuilders, arguing the nation doesn't need more new homes when there is such a huge inventory overhang.

CNBC reporter Kate Kelly came on the show to say that Groupon and Pandora had met with bankers this week to weigh the idea of doing an IPO. She said Groupon will probably seek an IPO of $1 billion or more, while Pandora will go after a $100 million offering.

Is the euro getting too big to fail? Amelia Bordeau, director of foreign exchange for UBS, said the euro rose today against the dollar on reports that a comprehensive package is in the works to backstop the sovereign concerns in the peripheral eurozone countries and on hawkish comments from European Central Bank chief Jean-Claude Trichet in his medium-term outlook on inflation.

She advised not taking new long positions in the euro and said Tuesday could be a big day for the currency when the fate of the comprehensive package will be clearer.

In the final trades, Kelly liked QLogic ( QLGC). Seymour said he would short Mechel Steel ( MTC). Adami sees Texas Instruments ( TXN) going higher. Terranova believes metals will be vulnerable Friday and advised shorting SPDR Gold Trust ( GLD) and Freeport McMoran ( FCX). Najarian said US Bancorp ( USB) has more room to run.

--Written by David Tong in San Francisco.

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