'Fast Money' Recap: Opening the Oil Spigot?

NEW YORK (TheStreet) -- WTI crude oil finished slightly lower on Monday while the S&P 500 eked out a slight gain of 0.08%. 

On CNBC's "Fast Money" TV show, the trading panel took a look at the possibilities of the U.S. releasing some of its oil reserves to combat the rising price of crude oil. 

Steve Grasso, director of institutional sales at Stuart Frankel, said that WTI crude oil seems to be hitting a temporary "ceiling" near current levels, at $106 per barrel. He added that a release of oil reserves will only help keep oil prices lower in the short-term. He is a buyer of Cheniere Energy (LNG), while Valero Energy (VLO) appears to be "rolling over" to the downside. 

Tim Seymour, managing partner of Triogem Asset Management, said the spread (or difference in price) between WTI crude oil and brent crude oil is likely to widen. He added that increased oil demand in the second half of 2014 will push oil prices higher. He is a buyer of Hess (HES). 

Karen Finerman, president of Metropolitan Capital Advisors, said it is "way, way too early" for the U.S. to consider releasing oil reserves. She reasoned that $106 per barrel used to be considered expensive, but it is not anymore. 

Guy Adami, managing director of stockmonster.com, said the U.S. government should consider adding to its reserves with crude oil prices at current levels, not selling it. He is a buyer of ConocoPhillips (COP). 

Martin Pyykkonen, senior analyst at Rosenblatt Securities, was a guest on the show. He said a lot of Yahoo!'s (YHOO) future rides on the valuation of e-commerce giant Alibaba, in which Yahoo! has a 22.6% stake in. The company plans on selling 10% of its stake in the IPO, with many analysts expecting Alibaba to be worth at least $150 billion. However, based on its recent growth numbers - which disappointed investors - the valuation could be lower than that. He concluded that Alibaba still has "solid" growth, despite the rate of growth slowing. 

Grasso said he is still long 20% of his original investment in Yahoo! and "assumes" it will trade higher as the IPO of Alibaba approaches. 

Finerman is long shares of Softbank, which has a significant stake in Alibaba. She reiterated that Alibaba's growth is not slowing, only the rate of growth is slowing, which is something to expect from all large companies. 

Seymour took a look at Chinese growth in general, saying that it is very impressive. He likes Baidu (BIDU), Vipshop (VIPS), and Tencent Holdings. 

Adami said investors should stay long Yahoo!. As long as Alibaba's valuation comes in above $150 billion, which he thinks it will, then shares of Yahoo! should trade "north of $40." 

Dennis Gartman, editor and publisher of The Gartman Letter, pointed out the United States is becoming more self-sufficient in regards to energy, and part of that is because of fracking. He is a buyer of the suppliers to fracking, which has large demand for water and sand. Gartman likes Hi-Crush Partners LP (HCLP), a sand supplier, which also has an attractive dividend. 

He added that the spread between brent crude oil and WTI crude oil is likely to widen, with the price of brent moving higher. He argued the price of oil looks like to be a little "pressed" on the upside, considering headlines from Iraq are sending prices higher, despite the fighting and conflicts not happening near the oil production facilities. 

Adami said he would stay long Apache (APA), which could be headed toward $100 to $105 per share. 

Seymour took a look at emerging markets via the iShares MSCI Emerging Markets ETF (EEM), which is near 30-month highs. It's running into resistance near $45 but Seymour thinks it will continue through this level and he is a buyer if it is able to breakout.

Tesla Motors (TSLA) jumped 8.5% after the company said the Model X will be available for delivery in the first quarter of 2015. Seymour said this news shouldn't matter because this information was already assumed. He added that Monday's price action was likely follow through from Friday when the company opened up its patents for other companies to see, allowing more advancements in the electric vehicle space. 

Seymour added he is not a buyer of this "ridiculously priced" stock, but also said he would never sell it short either. 

Grasso pointed out the company not only makes environmentally-friendly, electric cars, but vehicles that people actually want to drive, too. 

Grasso said investors can stay long Microsoft (MSFT) at current levels. 

SanDisk (SNDK) is buying Fusion-io (FIO) for $1.1 billion. Adami said Fusion-io was a "failing business" its buyout will likely further fuel shares of Micron (MU) to the upside. 

Dave Barger, CEO of JetBlue Airways (JBLU), said the company's new business premier class, called "Mint," will disrupt the way business travelers fly. It features private cabin doors, 15-inch screens with 100 DirecTV (DTV) channels, high speed Internet and the longest lay-flat seating for domestic flights.

He said rising oil prices are a concern, considering it's 40% of the company's input costs. He added that the company's investments into improving customers' flights is what's pushing shares higher. He said flight demand is relatively strong, and whether he will retire next year will be discussed this fall with the board. 

Seymour said the airline industry continues to improve margins and will therefore continue to see analyst upgrades. He added that investors can stay long JBLU. 

Micron jumped 2% and was the first on the show's "Pops & Drops" segment. Adami said shares look likely to climb to $35. 

Dreamworks Animation (DWA) fell 11%. Grasso said the content provider is down 31% for the year to date, and he is a buyer now that its share price is "on sale." 

Williams Companies (WMB) soared 19%. Seymour said the stock seems poised to go higher. 

Nuance Communications (NUAN) popped 10%. Finerman said she would not get long the stock at current levels.

Finerman said she is buying the $105 July call options in OpenTable (OPEN). She reasoned that when the company files its tender documents, which discloses information about its recent $105 per share takeover bid by Priceline (PCLN), it will show if there were other bidders interested in the company. Ifthere were no other parties involved, Finerman thought the stock could move higher on speculation that another buyer -- perhaps Google (GOOGL) -- will make a higher bid for OPEN. 

CNBC's Meg Tirrell took at look at Metronics' (MDT) planned acquisition of Covidien (COV) for $43 billion. She said it allows MDT to use its $14 billion in offshore cash without paying U.S. taxes. She added the medical device industry has been consolidating just as its customers have been, which has caused pricing pressure for these medical device companies. Part of the acquisition between MDT and COV is likely to regain some of that pricing power, she argued. She said Smith & Nephew (SNN) and Shire (SHPG) are two possible takeover candidates. 

Adami said C.R. Bard (BCR) has good earnings per share growth and a big share buyback. On top of having a "sound" business, it could also be a takeover target. Seymour said M&A deals are likely to continue in the medical device industry. 

Mike Newberg, a producer for Fast Money, was a guest on the show. He found $50 in the social media scavenger hunt that has spread from the west coast to the New York area thanks to @HiddenCash, the Twitter account that provides clues for finding cash. He asked the gang how to spend his winnings. 

Grasso said to Arch Coal (ACI) and Seymour said to buy Walter Energy (WLT). Adami said he'd be a buyer of EXACT Sciences (EXAS) and Finerman said to buy call options in OPEN. 

For their final trades, Seymour is buying BIDU and Finerman is a buyer of Express (EXPR). Grasso said to buy Twitter (TWTR) and Adami is a buyer of NUAN.

-- Written by Bret Kenwell in Petoskey, Mich.

Follow @BretKenwell

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

 

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter.

If you liked this article you might like

5 Stocks to Buy With Oil Prices Hitting Highs Again

5 Stocks to Buy With Oil Prices Hitting Highs Again

What's Hot and What's Not: Cramer's 'Mad Money' Recap (Thursday 10/12/17)

What's Hot and What's Not: Cramer's 'Mad Money' Recap (Thursday 10/12/17)

Activists Can Boost Shares: Cramer's 'Mad Money' Recap (Tuesday 10/10/17)

Activists Can Boost Shares: Cramer's 'Mad Money' Recap (Tuesday 10/10/17)

Broad Gains Push Wall Street Higher, S&P 500 on Track for Fifth Day of Gains

Broad Gains Push Wall Street Higher, S&P 500 on Track for Fifth Day of Gains

A Rebound in Crude and Energy Stocks Drives S&P 500 Higher for a Fifth Day

A Rebound in Crude and Energy Stocks Drives S&P 500 Higher for a Fifth Day