3 Stocks I Saw on TV: JCP, HPE, AMBA (March 4, 2016)


Every day we watch the same shows on CNBC, Fast Money, Mad Money, Opening Bell, Closing Bell, Squawk on the Street, Power Lunch, Fast Money Halftime Report, you name it. You get a ton of tickers, it’s hard to sift through them all. Here are 3 stocks that I saw on TV that I think we can make some money on, or at least not lose some money.

First of all JC Penney ( NYSE:JCP ). This stock is up over 30 percent since this breakout here; a very short period of time. They got an upgrade on Friday. Evercore upgraded the stock, pushed their price target, I think it was $8.00, or something like that, well they bumped it up to 15.00. So, is this a stock that you want to buy? Not me, and I’ll tell you why: Because it’s pushing up against resistance and to me this isn’t all about JC Penney ( NYSE:JCP ), whether it’s going higher or lower, this is about my money. About where I can put it that is going to be the best place for it. And right now I’m looking at JC Penney ( NYSE:JCP ), definitely over bought. When the heck has this thing had a down day? This was the worst day that it had, it basically closed flat. So this has been on a tear for quite a while. But it’s up still at 11.50, where basically this stock has not been able to get above there for quite some time. It’s frankly, kind of a natural sell level, right here. Then if the stock pulls back fine, maybe you consider buying this stock. But the compelling dividend that they pay, Oh, that’s right, they don’t pay a dividend, is not going to work for us either. So this is one, frankly if you are long this stock you better keep a tight trailing stop on it. Because when the buying starts to wane a little bit, I think you’re going to see the selling pick up. Nothing wrong with JC Penney ( NYSE:JCP ) long, long, long-term, but short-term this is one that you do not want to be holding for too long.

Hewlett Packard Enterprise ( NYSE:HPE ), they beat their Q1 earnings and revenues; remember this is a spin-off from Hewlett Packard. This is essentially an IPO, it’s not, it’s a spin-off, but it’s kind of the same thing. This is the most recent (meaning the only) high of 15.88. That was from back here in December. Today, on Friday, the stock almost hit that level, 15.84. The bottom line is, this resistance is still holding. This was the top, drag this thing over, this is not a stock that I want to buy here. The catalyst was huge, the stock is up almost 14 percent in one day. So here’s my question: Where’s the catalyst that’s going to push this stock to a new high, like right now? My bet is the sock will probably drift around, maybe not completely sell off, because the earnings were really good, revenues solid, all that. That’s what you want to hear. But with this stock up at it’s all-time high from just last December this is one that you don’t want to be buying right now. Frankly, this is another one that I would want to sell into, just to error on the side of safety.

Now, Ambarella ( NASDAQ:AMBA ), supplier for GoPro. This company reported earnings, they beat sales and earnings, but they gave weak guidance. Here’s the thing: Traders anticipate earnings and revenue numbers. They anticipate that if the expectation is that the company’s going to beat their revenue and earnings estimates you’re going to see buying into the earnings number, the stock is going to start moving up as it did here. A company can report blow-out earnings but if they say, “By the way, going forward, you know that guidance that we had. Or the earnings estimates, or the revenue estimates that other people have had for us? This is the real estimate.” And then they actually lower that guidance. It doesn’t matter what the most recent earnings and revenue numbers are, that stock is going to fall because traders don’t really care about what’s already happened, they care about what’s going to happen in the future. That is why Ambarella ( NASDAQ:AMBA ) was down almost 10 percent. Right now, this stock, in my view, is kind of in jail. It didn’t come close to this last low here, and that’s a good thing. But then all I see now is a bottom that’s trying to form. That’s it, it’s a bottom that’s trying to form. I think this is the ultimate low, this is really the trading range right now. I see a lot more risk in this stock as far as just kind of backing and filling, than I do in the risk of missing this kind of wonderful move here. The overall market is up at resistance so unless there is some kind of huge, massive broad market rally, I think Ambarella ( NASDAQ:AMBA ) is one that you kind of want to steer clear of right now.

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