Why Alliance Resource Partners, Costamare, and KBR Jumped Today

By Dan Caplinger Markets Fool.com

The stock market started out on a positive note on Monday, as investors celebrated the beginning of the new month and a potential resolution to the threat of a looming government shutdown. A comment from President Trump regarding a potential breakup of large banking institutions was a wild card for market sentiment. Among major benchmarks, the Dow finished down very slightly after being in the green for most of the day, and technology stocks led the Nasdaq Composite to a small gain. Moreover, some individual stocks were extremely strong, and Alliance Resource Partners (NASDAQ: ARLP), Costamare (NYSE: CMRE), and KBR (NYSE: KBR) were among the best performers on the day. Below, we'll look more closely at these stocks to tell you why they did so well.

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Alliance lights up

Alliance Resource Partners was up almost 9% after the coal producer reported increases in quarterly coal volume compared to prior-year levels. Revenue was up 12% for the quarter, and net income more than doubled from year-ago levels. CEO Joseph Craft III noted that Alliance has worked hard to cut costs by shifting production to the mining assets that have the lowest expenses of production, and the coal producer has also worked on marketing its coal more effectively. Alliance's efforts to secure long-term financing have been successful, and despite having to tap the high-yield bond market to get loans, the master limited partnership is just one notch away from achieving an investment-grade bond rating going forward. Alliance is still having to deal with renegotiating expiring supply contracts at lower prices, but it sees coal-market improvement as likely for the rest of 2017.

Image source: Getty Images.

Costamare sails higher

Costamare stock climbed 14%, bouncing back from poor performance last Friday in the wake of the company's first-quarter financial results. The shipping company said late last Thursday that voyage revenue fell 12%, leading to a nearly 40% plunge in adjusted net income and causing earnings per share to get cut in half. The stock responded by falling about 3.5% on Friday. But today, analysts at Credit Suisse upgraded the stock from underperform to neutral and boosted their price target on the stock from $5 to $8 per share. The analyst was pleased at Costamare's pickup in charter business, and many are hopeful that Costamare and its peers in the shipping industry will be able to take advantage of improving global economic conditions to recover more fully from a slump that has cut roughly 70% from the company's stock price since 2014.

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KBR bounces back

Finally, shares of KBR were up 5.5%. The engineering and construction management specialist bounced back from a setback on Friday, which resulted from the company's first-quarter earnings report as well as news that the Serious Fraud Office of the U.K. government was looking at KBR's dealings with Monaco-based Unaoil. With respect to the Unaoil allegations, KBR has been connected with a similar Securities and Exchange Commission investigation in the U.S., and so the matter comes as nothing new for KBR. The news sent KBR stock down 9% on Friday, but today's gains earned back about half of that loss, as investors apparently decided that the initial move had been an overreaction.

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Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends Alliance Resource Partners. The Motley Fool has a disclosure policy.