An election victory in Greece by the leftist-leaning Syriza party rattled the U.S. stock markets a bit this morning, but they rallied back solidly from early deficits to post higher numbers by the end of the day. New York traders were keeping one eye on the big board and one eye on the weather channel, as they braced for what could be one of the biggest snowstorms to hit the eastern coast of the U.S. in many years.
The Dow Jones Industrial Average ended flat on the day, while the S&P 500 rose 0.25% and the Nasdaq was 0.29% higher.
Energy and consumer cyclical goods were the best performing sectors on the day, with financials and healthcare also showing strength. The latter two sectors were well represented by D.R. Horton, Inc. (NYSE:DHI), HCA Holdings Inc. (NYSE:HCA), and Ocwen Financial Corp (NYSE:OCN), which were among the day’s best stocks.
D.R. Horton, Inc. (DHI)
DHI stock was moving well north today after the company posted first-quarter earnings of 39 cents per share that beat analysts’ expectations of 34 cents. Revenue of $2.25 billion was up 37% year-over-year, and also topped the Street’s view of $2.1 billion. DHI was trading more than 5% higher on the news, on solid volume of 12.5 million shares.
D.R. Horton delivered 7,973 homes this quarter, or 29% higher than a year ago, ahead of the 6800, expected by Wall Street. DHI said it has yet to see any real estate slowdown in Texas from the collapse in oil prices.
D.R. Horton is the first of five homebuilders to report this week, in what could be a solid showing for that group.
HCA Holdings Inc. (HCA)
HCA stock shot up by more than 4% today after the S&P 500 benchmark said it will add HCA to its index after the closing bell, to replace Safeway Inc. (NYSE:SWY), which is being bought by private equity firm Cerberus Capital. HCA is the largest U.S. hospital company by sales, and its stock has improved by 44% over the past 12 months. In addition to the S&P 500, HCA also will be added to the Health Care SPDR (ETF) (NYSEARCA:XLV).
Ocwen Financial Corp (OCN)
OCN stock rocketed higher by more than 8% today on 40.9 million shares after reaching a settlement with California’s Department of Business Oversight over the weekend. Ocwen agreed to pay $2.5 million and hire an auditor to analyze its mortgage service practices. Additionally, OCN cannot take on any new California customers until the DBO allows it to do so. In return, and most importantly, the DBO will not suspend Ocwen from doing business in California.
OCN has been pummeled in recent months as investors awaited word on the outcome of the investigation. The decision could have been a lot worse for Ocwen; the company could have lost its license to provide mortgages in California, and as the stock had already dropped from $55 to $7 per share over the past 12 months, the stock was due for an oversold relief rally. Hopefully, today’s settlement can get OCN stock back on track.
As of this writing, Ethan Roberts did not hold any positions in the aforementioned securities.
