Why Sprint, SunPower, and Hooker Furniture Jumped Today
The stock market soared on Wednesday, with the Dow and S&P 500 reaching new all-time record levels. Major market benchmarks were up more than 1%, with many market participants looking closely at meetings later this month from central banks across the globe, including the Federal Reserve. These meetings could have big implications for interest rates, and pain in the bond market could lead more investors to move into stocks. Some individual companies also did particularly well today, and Sprint (NYSE: S), SunPower (NASDAQ: SPWR), and Hooker Furniture (NASDAQ: HOFT) 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.
Image source: SunPower.
Investors want Sprint to show them the money
Sprint rose 9% as investors responded favorably to news that SoftBank CEO Masayoshi Son intends to invest as much as $50 billion in the U.S. in the near future, with the intent of creating as many as 50,000 new jobs. The news, which came through a Twitter message from U.S. President-elect Donald Trump, also renewed speculation that a better relationship between Son and the U.S. government could lead to merger discussions between Sprint and industry peer and rival T-Mobile, which also climbed today. The two smaller carriers have fought hard to gain a better foothold in the mobile carrier industry in the U.S., and resistance to past discussions of a potential merger on antitrust grounds could wane or disappear after the inauguration.
SunPower gets rewarded for making tough moves
SunPower jumped 14% after the company announced some major cost-cutting initiatives. The solar giant said that it would close a plant, reducing its production capacity by about 700 megawatts to balance supply and demand. SunPower will also cut 2,500 jobs, which amounts to about a quarter of its workforce, and its goal is to cut its 2017 operating expenses to $350 million or less. Overall, SunPower's restructuring moves will incur charges of $225 million to $275 million, but CEO Tom Werner believes that the moves will "enable us to successfully navigate through the current market transition and maximize cash flow while successfully positioning the company for the next phase of industry growth." In part because SunPower had already announced its intent to make a strategic decision like this, investors seemed prepared and applauded the details as they become available. Clearly, investors hope that SunPower's moves will be enough to keep the company moving forward.
Hooker Furniture gets comfortable
Finally, Hooker Furniture gained 10%. The furniture maker announced its third-quarter results Wednesday morning, revealing extensive revenue gains and earnings that were better than most had expected to see. The recent acquisition of Home Meridian International contributed extensively to Hooker's doubling of its sales, but even on a sequential basis, sales growth showed healthier conditions in the industry. Operating income gains were impressive, and the company appears to be getting good order traffic, sending backlogs to record levels. If customers keep doing better financially, then Hooker Furniture could stand to reap the benefits well into the future.
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