Tim Seymour, managing partner of Triogem Asset Management, said Dan Loeb and John Paulson both sold out of their Alibaba (BABA) positions. Seymour remains long the stock and considers it cheap based on its strong growth rate. He also believes the stock is setting up to have a nice move higher.
The stock also looks good on the long side to David Seaburg, managing director and head of sales trading at Cowen & Company. After a brutal selloff over the past six months, Alibaba appears to be under-owned by many funds and investors. The stock is at a good level to continue getting long, he said.
Brian Kelly, founder of Brian Kelly Capital, likes Alibaba but has his eye on General Motors (GM) after it was revealed David Einhorn recently took a long position. While its shares haven't traded all that well over the past few months, GM now looks to be at support and offers a good risk-to-reward to shareholders who get long.
There has also been speculation that McDonald's (MCD) may be facing activist investors. Despite Yum! Brands (YUM) having vastly outperformed McDonald's, Steve Grasso, director of institutional sales at Stuart Frankel, says it's time to sell Yum! and buy McDonald's.
Netflix (NFLX) stock climbed above $600 for the first time. Grasso says the stock is overvalued, simply because shares have climbed too far, too fast. Those looking to buy the stock should wait for a pullback.
Kelly agreed, adding that investors should refrain from shorting Netflix. However, it's an "aggressive assumption" to say that Netflix will double its subscriber base over the next five years, he said. Seymour added that competition could impede Netflix's plans to continue expanding.
However, Seaburg thinks Netflix could grow its subscriber base to 150 million subscribers over the next five years. Assuming it had 150 million subscribers and charged $12 per month for its service, it could justify a stock price of $1,400, based on 20% margins and a 20 times earnings multiple, he explained.
"I like Home Depot," Seaburg said, adding, "I like it over Lowe's (LOW)." He expects Home Depot to report a "very strong quarter." Seymour added the home improvement cycle is still in the early stages and made the case that investors can stay long Home Depot. He also likes Wal-Mart, which is at "very powerful support" at $78.
Kelly thinks investors can buy Wal-Mart ahead of earnings. The company is boosting its online presence, which should bode well for future growth.
When it comes to Best Buy, Grasso says the long-term story is still attractive. However, the current price of the stock is not. For that reason, he suggests waiting for a pullback down into the high $20s before getting long.
Instead of buying Best Buy, investors should just buy Apple (AAPL) since it sells such highly desired devices, Kelly added.
There is very little, if any, upside to Best Buy. The company will "whiff" when it reports earnings next week and investors should avoid the stock, Seaburg said.
For their final trades, Seymour is buying the iShares MSCI Turkey ETF (TUR) and Seaburg is a buyer of King Digital (KING). Kelly said to buy Bank of America (BAC) and Grasso is buying Generac Holdings (GNRC).