'Fast Money' Recap: Some Good, Some Bad for Cisco

NEW YORK (TheStreet) -- U.S. equity markets moved higher on Wednesday, with the S&P 500 climbing 0.67%. 

On CNBC’s “Fast Money” TV show, the trading panel took a look at Cisco Systems (CSCO) following its earnings report. 

Pete Najarian, co-founder of optionmonster.com and trademonster.com, pointed out the company beat on top- and bottom-line estimates and bought back a lot of shares. He is a buyer on Thursday if the stock opens lower. 

Brian Kelly, founder of Brian Kelly Capital, said Cisco had some good things and some bad things in its report, and like the economy it is doing “okay, but not great.” The U.S. business was strong while the company struggled outside the country. 

Jon Najarian, co-founder of optionmonster.com and trademonster.com, said Cisco is having trouble gaining traction in emerging markets, but the company has a ton of cash and he “wouldn’t be unhappy about these results.” 

Guy Adami, managing director of stockmonster.com, called the stock cheap based on valuation. However, he argued that based on recent price action, the stock could trade lower. If it gets to $22.50, he is a buyer.

Inder Singh, managing director at SunTrust Robinson Humphrey, has a buy rating and $27 price target on shares of Cisco and is pretty happy with the results. The company has reported “two solid quarters in a row,” he said. The company continues to set the bar low and then exceed it. In other words, guidance was likely conservative, he concluded. 

Adami is a buyer of VMware (VMW), and called the valuation “fair.”

Jon Najarian said Tekmira Pharmaceuticals (TKMR) continues to lose money very quickly, which is expected of a small-cap biotech stock that it accelerating its treatment tests and studies. He called the stock a “no touch” for investors who are not long, and a hold for investors who have been in the name after the big upside move over the past few weeks. 

Pete Najarian called the recent pullback in Macy’s (M) a buying opportunity. The company grew earnings 11% year-over-year, despite missing analysts estimates. 

Kelly disagreed, saying he is not a buyer of Macy’s or Nordstrom (JWN), citing weak retail sales for July. 

Adami said he is a buyer of Macy’s, which has a reasonable valuation. He suggested using a stop-loss near $54. 

Kelly is a buyer of grains, based on the expectation that tension will rise between Russia and Ukraine. 

Adami said Deere (DE) looks a “little dicey” near current levels. He suggested giving the stock a few days to settle down and find support. 

Pete Najarian pointed out that one of the bright spots in Deere’s earnings report was in construction equipment. This bodes well for Caterpillar (CAT), he reasoned. 

James Albertine, auto analyst at Stifel Nicolaus, upgraded shares of Ford (F) to buy from hold and raised its price target to $22. He said the company has a big advantage with its aluminum-bodied F-150, which debuts in the fall. Ford is well positioned compared to its peers and can experience strong earnings growth amid strong consumer demand. 

Pete Najarian said investors can own Ford for stability and Tesla Motors (TSLA) via options for the upside potential. 

Adami is a buyer of ExOne (XONE) at $25. 

Jon Najarian pointed out the bullish options activity in Generac Holdings (GNRC), specifically citing the activity in the November $52.50 call options. 

Pete Najarian also pointed out the bullish options activity in Nucor (NUE), specifically citing the activity in the October $52.50 call options. 

SeaWorld Entertainment (SEAS) plunged 32% and was the first stock on the show’s “Pops & Drops” segment. Adami said, “Don’t even think about owning the stock,” until the company starts to address the issues that the public has with it. 

Pandora (P) climbed 10%. Jon Najarian said there were a lot of short-sellers squeezed in the move higher, on very strong volume. 

FuelCell Energy (FCEL) popped 4%. Kelly said investors shouldn’t get too excited since the stock only moved higher from an analyst upgrade. 

King Digital Entertainment (KING) dropped 23%. Pete Najarian said there’s no need to rush into the stock on the long side.

Jason Del Rey, senior editor at Re/Code, said Amazon’s (AMZN) push into digital payments is a long-term objective, and the company’s goal is to undercut its competition to build up its user base. Square, a big player in this industry, probably isn’t too worried for the time being, he said. However, there’s enough room for several companies in the industry and Amazon is likely to be one of them, he concluded. 

Pete Najarian is long Amazon and said this move into digital payments should be good over the long-term. He likes the current price action of the stock. Adami also likes Amazon on the long side, but has a very tight stop-loss of just $320. Jon Najarian added that Amazon posted a 40% increase to sales in July from year ago figures. 

Robert McEwen, chairman and chief owner of McEwen Mining (MUX), was a guest on the show. The stock is outperforming the broader index, gold and the Market Vectors Gold Miners ETF (GDX). 

He said the company is focused on building value and sees gold prices doing well during the seasonally strong period of September and October. Management is also focused on containing costs. He is not worried about hedging gold prices, as he sees the metal headed to $5,000 per ounce over the next three to four years. 

Kelly said a move to $5,000 per ounce is unlikely but certainly possible given the potential inflation scares and geopolitical unrest. However, he likes gold mining companies because many of them pay attractive dividends as well as provide exposure to gold prices. 

Pete Najarian suggested that $2,000 per ounce seems reasonable for gold over the time span of three to four years. Adami said Facebook (FB) seems poised to climbed to $75. 

Jon Najarian says Yelp (YELP) has room to the upside. 

For their final trades, Pete Najarian is buying MarkWest Energy Partners (MWE) and Kelly is buying the Market Vectors Gold Miners ETF (GDX). Jon Najarian is buying Generac Holdings and Adami is a buyer of Michael Kors (KORS). 


-- Written by Bret Kenwell in Petoskey, Mich.

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

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