U.S. markets opened lower this morning, as traders were wary of putting fresh money into stocks ahead of the weekend on nervousness concerning the Federal Reserve’s Sept. 17 meeting. But things improved in the afternoon, as stocks finished well.
Crude oil was down again, after Goldman Sachs Group Inc (NYSE:GS) and German’s Commerzbank both cut their price forecasts. Goldman’s cut was from $57 to $45 on Crude oil, and from $62 to $49.50 on Brent oil. The German bank said Brent could trade at $55 before 2015 ends, but should rise to $65 the following year. Crude oil was down more than 2% today.
In U.S. economic news, the August Producer Price Index was unchanged, slightly better than the 0.1% decline that economists were expecting. Core PPI rose 0.3% and was 0.7% higher over the past year.
The Dow Jones Industrial Average was up 0.6%, while the broader S&P 500 Index rose 0.4 and the Nasdaq Composite was 0.5% higher. Most sectors finished higher and utilities were the best of the group.
Solid earnings reports and positive mentions from analysts were making winners of several stocks, such as Shake Shack Inc (NYSE:SHAK), Kroger Co (NYSE:KR) and Restoration Hardware Holdings Inc (NYSE:RH). Here are the full details:
Shake Shack Inc (SHAK)
SHAK shareholders got a delicious treat this morning when Cowen Group Inc (NASDAQ:COWN) initiated coverage on the New York based restaurant chain with a rating of “market perform” and a price target of $42 a share.
There was some concern that SHAK’s value might already be too high, given the number of existing markets where they are currently located, but Cowen feels they still have room to grow in smaller areas.
SHAK stock climbed 13% today, but is still well off its high of $96.75, set in May of this year.
Kroger Co (KR)
Grocery store chain Kroger rose more than 5% today after posting second-quarter fiscal 2015 earnings that were 44 cents a share on revenue of $25.5 billion. Kroger’s earnings per share beat analyst estimates for 39 cents a share, and matched revenue estimates for $25.5 billion
In addition, Kroger gave forward guidance between $1.92 and $1.98 a share, an increase of 2 to 3 cents from an earlier estimate. The Street’s view is for $1.95 a share.
KR stock has traded in a narrow range this year, but the stock price has more than doubled since the beginning of 2014.
Restoration Hardware Holdings Inc (RH)
Restoration Hardware, a home furnishings retailer, also beat analyst estimates on their second-quarter earnings report after Thursday’s market close, coming in at 85 cents a share on revenue totaling $506.9 million.
Revenue was 16% higher than the year-ago period. The Street was awaiting word of 83 cents a share, with revenue estimates of only $502.3 million.
RH also announced two new furniture lines that are coming to their stores soon — RH Modern and RH Teen, a luxury line and a line focused on decor for teenagers, respectively.
RH stock was up more than 9% today on the news.
As of this writing, Ethan Roberts does not hold a position in any of the aforementioned securities.
