3 Stocks I Saw on TV: VZ, KBH, AAPL (April 7, 2016)
YHOO RLYP YHOO VZ KBH AAPL
Every night we watch the same shows, Fast Money and Mad Money. And we want to use those ideas to grow our money, right? Good trading takes more than just punching the buy button the next day after you get a bunch of ideas from the day before. I want to help you make money on 3 stocks that I saw on TV.
The first one we’re going to look at is Yahoo ( NASDAQ:YHOO ). The big skuttlebutt is that Verizon ( NYSE:VZ ) is set to make an offer for Yahoo’s ( NASDAQ:YHOO ) stake in their Japan subsidiary, as well as their core business. I thought it’s interesting that during the day this stock was actually down. It gapped up a little bit, everybody was all enthusiastic and then as the day went on the market kind of yawned. So now after hours there’s a little “meat on that bone” as far as what’s going to happen. Google ( NASDAQ:GOOGL ) might make an offer next week, maybe not. Who knows? But the thing that I’m looking at here is, this is the way the stock is trading into the end of the day, a big move up. Now the stock has just been drifting sideways. So you’ve got all this news out here, that such and such a company might be bought out.
Well, this is what typically happens, when there’s a rumor or some kind of thought that a company is going to be acquired; you get Relypsa ( NASDAQ:RLYP ) here, and then you’ve got Yahoo ( NASDAQ:YHOO ). I would just frankly, I hate to say it but I would just stay away from this. If they get a buyout offer, great! Maybe you’ll make a few bucks. But it could very well be that these companies look at it and the offer that they make doesn’t exactly thrill shareholders. And that means, in my mind, shareholders very well could be looking at whatever offers made and go, “You know what? Is that all this pig is worth? You know what? I think I will just sell this to somebody else who wants to take that deal.” So just be careful about Yahoo ( NASDAQ:YHOO ); that’s what I would say. And also, with respect to Verizon ( NYSE:VZ ), they don’t report earnings for a while. I’d have to say this little pullback doesn’t exactly speak volumes of what the market thinks about Verizon’s ( NYSE:VZ ) potential buy. I don’t even know why they would buy Yahoo ( NASDAQ:YHOO ) in the first place. But that’s just me and what do I know?
Okay, KB Home ( NYSE:KBH ). The reason I’m mentioning this is, they were chatting about the homebuilding industry fairly briefly on Fast Money and Steve Grosso said that he’s had a position in KB Home ( NYSE:KBH ) and he added to that position on some weak news around Pulte Homes ( NYSE:PHM ). So here’s the deal: I like the fact that this stock is above the 200-day moving average. This is not fast money, this is just money. It’s not really a trade, I don’t think, I haven’t talked to Steve about this, but this is more of a position. So as long as the stock is staying above this 200-day or 40-week moving average I think you’re fine. But just know that generally speaking the stock is trending lower. It’s still on that chart making lower highs and lower lows, If the stock starts drifting back below 13.50 or 13.60, I wouldn’t want you to be long this stock. But for the time being, I think it’s fine.
Okay, last thing, Apple ( NASDAQ:AAPL ) retreated today, pretty significant, over 2 percent. BTIG cut it’s price target down to 131.00 from 141.00. Still a buy, although it’s funny how you say, “Buy the stock, only it’s going to make $10.00 less than we though it was.” So whatever, that’s why I’m not an analyst. There’s not a day that goes by that I don’t express gratitude for that. So with Apple ( NASDAQ:AAPL ), what are you going to do? As long as the stock is here, above the 20-day moving average. We could even tighten that up to maybe the 10 or the 15-day moving average that really connects these lows here, but I don’t really think we need to do that. As long as the stock is staying above this 20-day moving average, I think Apple ( NASDAQ:AAPL ) is still a stock that you want to buy. Frankly, I think you want to buy it on any weakness. I just don’t see the stock going down too much more, certainly before their earning are due to be released. They’ve got this upgrade cycle that the Fast Money guys think that that’s going to be positive for the stock.
Frankly, just between us girls, between you and me, I don’t really think that much of it and I’ll tell you why, because I was just in the Apple ( NASDAQ:AAPL ) store yesterday because my existing phone blew out. They were trying to talk me into an upgrade; the same iPhone 6 or whatever, but the new and improved one, for like $900.00 or something. I looked at it, I couldn’t tell the difference. And the guy says, “Oh, well the screen is more touch sensitive and the body is tougher.” I just looked at him, and I’m telling you this for a reason, because I’m not the only guy that’s going to think this. I said, “You know what? I can’t rationalize upgrading for that amount of money. It looks the same, I don’t really care about a tougher shell, because I just put a case on top of it and that’s my durability. So I’m not really sure why I want to upgrade.” And the guy looked at me and he said, “I really wouldn’t either.” That’s an Apple ( NASDAQ:AAPL ) employee telling me that. So I’m telling you, I don’t really know much about whether this upgrade cycle is going to work. But if my personal experience is any indication and what one of the store employees told me, I just don’t think it’s going to amount to much. But with that said, if Apple ( NASDAQ:AAPL ) starts breaking through this 200-day moving average, I would say it’s gone down enough and it’s probably going to start moving higher.
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