3 STOCKS I SAW ON TV: LULU, VRX, YUM (April 15, 2016)
Every night we watch the same shows, Fast Money and Mad Money, and we want to use those ideas to grow our money, right? Well good trading takes more than just punching the buy button the next morning on the tickers you saw on TV last night. I’m here to show you how to make money on these 3 stocks that I saw on TV.
We’re starting off with Lululemon ( NASDAQ:LULU ). The stock is right up at resistance, it’s $70.00. Cramer was talking about it on Mad Money; he thinks this is a buy. He likes it a lot better than Nike ( NYSE:NKE ), I can’t really disagree with him. Although, lets do a Trading Places, last scene, lobster or cracked crab? Why can’t we have both? I think you could have a little Nike ( NYSE:NKE ). But Lululemon ( NASDAQ:LULU ), this has pulled back to a pretty good opportunity to buy. They don’t report earnings again until June. So this stock is going to trade technically for a while, zigzagging higher highs and higher lows. It’s just come off of this low, I think Cramer’s right, I think you buy this stock, you can ride it up to 70.00 and then if the stock breaks through, buy some more. Don’t just load the boat now but take half a position. And then if the stock breaks out above 70.00 you’re happy that you at least owned some stock. But if it doesn’t breakout above 70.00, and then ultimately rolls over, well then you’re happy that you didn’t own a whole boatload of stock.
Now, Valeant Pharmaceuticals ( NYSE:VRX ). They report earnings on the 28th of April, but they have a lot more to do other than just report earnings. Cramer just thinks this is a crap shoot and he can’t recommend it. I totally agree on this. It’s one of those things where there’s such headline risk, if you feel like you’ve got an edge, “Oh I know they’re going to be in default.” Well then do you think you know anything more than hedge fund managers that trade a heck of a lot more zeros in their account than you do? No. You’re just thinking. You’re hoping. You’re thinking, “Oh I’m sure.” No you’re not. I’m sure of this, $25.00 is support That’s support for this stock. This support is either going to hold or it’s not. Gun to head, what would I do? I would probably try to disarm the guy with the gun and just basically pistol butt him. This is a stock that is really, really risky. Take your shot, either buy it or short it and then live with the consequences. Me, I’m moving on.
I’m moving on to YUM! ( NYSE:YUM ). Cramer thinks you buy this stock. You buy a little bit early in the week, you buy a little bit later in the week. They report earnings on the 20th, so they’re reporting next week. So buy some stock now and then take some after. That’s fine. I’m just saying this, from a chart standpoint, this is a real murky chart. The only way you can kind of make sense out of it is if you really zoom and this is your time frame, you’re looking for a breakout above 83.00 and that’s your buy signal. I would rather, actually, wait for that. I would want to see the stock on Monday or Tuesday; I would rather see it breakout at 83.00. Then on Wednesday when the company reports earnings, if it stays above 83.00 then I’ll buy some more. If it doesn’t, then I wouldn’t.
Just think about it this way, do you like the stuff that’s in YUM! Brands ( NYSE:YUM ) portfolio, it’s a lot more than it used to be, or do you not? And that’s how you make a decision, frankly, on buying this stock. This is a pattern, this chart is just sloppy. Like I said, you really have to zoom in to find a trend here. So if this can’t be your time frame, then just follow along with Cramer, buy some now and wait and buy some more after the earnings number. You’re either going to be able to get that second half at a discount or it’s going to turn out that you’ve got the first half at a discount and the second half you’re getting at a premium. But just make sure you like the company. The chart traded just like I said, and that’s that.
3 Stocks I Saw on TV Free Chart