Charles Payne: I think Delta will come out of bankruptcy, and the new stock should do well. Right now, I think you're flying high in the friendlily skies, Jerry, with that target of $10 to $20 in the near future. Of course, Continental made a Phoenix-like return. In the most recent quarter, Delta lost $2.2 billion, but excluding cost related to the bankruptcy, they would have earned $175 million. The company is coming back, and I think the stock will do well — but you may have to be patient.
Question: Will Cisco (CSCO) ever come back over $20? Is it worth holding? I'm tired of waiting. Thanks. — Frank (Wappingers Falls, NY)
Charles Payne: Cisco (CSCO) is a friend of shareholders again, and John Chambers has regained his swagger. It's been five years since there has been real demand in the space and now that's changing. The company has fought off competition nicely. Although a couple of competitors are carving out some market share, Cisco is still the undisputed leader and the stock is beginning to reflect that.
Question: With all the problems with General Motors (GM) and Ford (F), where have the unions been? I'm a conservative, and I'm not necessarily pro-unionization. However, with two giants like these essentially on the brink of going under without taking a retrenchment strategy, why have the unions not jumped all over this issue? — Christopher (TX)
Charles Payne: Unions are as entrenched in the automakers as the communists are in North Korea, and it's the last stand for both of these ideologies. Of course, unions play an important role, but they played a more realistic role in the past. Now, they are part of the problem, crippling the ability of large U.S. carmakers to compete. This week, there will be more wrangling as unions try to squeeze more money out of Delphi, and actually push to have their contract with that parts-maker voided. That would give them the right to strike against GM (the former parent and largest customer of Delphi).
Delphi lost $2.6 billion in the first half of the year, and $1.9 billion is associated with early buyouts, which is hurting the power of unions. Make no mistake — the UAW is in the mix, but the courts are as well. Currently, Judge Drain of the Southern District of New York oversees the Delphi case; he's thought to be sympathetic to both sides and will not force anything until the parties involved come to a mutual agreement. The unions are all over the situation — it has their fingerprints, like those of a bandit left at the scene of a crime.
Question: In light of the "exploding laptops," should I dump my Dell (DELL)stock? Thanks — Kevin (Pasadena CA)
Charles Payne: I don't like Dell (DELL), but I didn't like it before the "exploding battery trick." The stock is cheap fundamentally so the downside should be limited. However, I think Apple (AAPL) is a much better play — cooler machines, in which all the hot stuff stays on the screens.
Charles Payne is the founder and CEO of www.wstreet.com and appears regularly on FNC's Cost of Freedom Business Block.
Charles Payne is the host of Making Money with Charles Payne (weekdays 6-7 PM/ET).