Why Sturm Ruger, Wayfair, and Valeant Pharmaceuticals Jumped Today

By Dan Caplinger Markets Fool.com

Tuesday was another relatively calm day on Wall Street, with the Nasdaq hitting a fresh record but the S&P 500 falling back from its own all-time highs late in the day. With earnings season starting to wind down, investors will now turn their attention to macroeconomic and geopolitical concerns, and the potential for a Federal Reserve rate increase in June could become the focal point for market participants for the next six weeks or so.

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Yet some individual stocks didn't wait to climb higher, posting good news that excited their shareholders. Sturm, Ruger (NYSE: RGR), Wayfair (NYSE: W), and Valeant Pharmaceuticals (NYSE: VRX) 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.

Ruger fires upward

Shares of Sturm, Ruger shot higher by 10% after the company released its first-quarter earnings results. The gun manufacturer's performance didn't look all that strong on its face, with revenue falling 3% from the year-ago period and earnings coming in flat compared to the first quarter of 2016. Yet most investors had anticipated a much more substantial pullback in Ruger's business, given that the Republican victory in the 2016 presidential election dramatically reduced the likelihood of any gun control legislation moving forward in the near future. Despite some concerns that weak consumer demand for guns could continue, shareholders seemed happy that the company had managed to hold up this well early on in the year and hope that more optimistic trends will prevail.

Image source: Sturm, Ruger.

Wayfair keeps boosting its sales

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Wayfair stock jumped 21% in the wake of the company's first-quarter financial report. The online home furnishings retailer reported nearly 30% growth in net revenue compared to the year-ago quarter, and despite posting a substantial adjusted loss of $0.48 per share, most investors following the company had expected to see even more red ink with slower sales gains. Growth in Wayfair's direct retail segment has come as a shock to many watching the company, in large part because conventional wisdom held that large items like furniture and other home accessories couldn't sell well through an e-commerce channel. Wayfair's experience is throwing that conventional wisdom on its head, and solid guidance for the current quarter suggests that the online retailer's success could continue well into the future.

Valeant cleans up

Finally, shares of Valeant Pharmaceuticals rose by 24%. The beleaguered pharmaceutical company reported its first-quarter financial results, posting a profit and reversing a year-ago loss. Many shareholders were pleased with the efforts that Valeant has taken to reduce leverage, and the company said that its debt was down by $1.3 billion during the quarter. Declines in revenue and adjusted net income came from the loss of patent exclusivity for a number of its products, as well as Valeant's strategic moves to focus on its core business. Yet Valeant also boosted its adjusted pre-tax operating earnings guidance slightly, and for shareholders who've weathered the storm thus far, the news supports the idea that Valeant has prospects to mount a long-term turnaround given time.

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Dan Caplinger has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Valeant Pharmaceuticals and Wayfair. The Motley Fool has a disclosure policy.