U.S. markets began the week on a tepid note, as traders were looking at more earnings, especially from Apple Inc. (NASDAQ:APPL), which will announce earnings after the closing bell tomorrow. AAPL stock was down more than 3% today.
Traders were also concerned about what the Fed will say when they conclude their two-day meeting on Wednesday. The Bank of Japan also meets this week and could announce that more stimulus is forthcoming.
Meanwhile, crude oil continued its slow but steady collapse, settling below $44, the lowest price since early August.
In U.S. economic news, the Commerce Department reported that after gaining units for two straight months, new home sales fell 11.5% in September. The street was looking for 550,000 annualized units, but instead the number reported was only 468,000. It was the lowest level since November, 2014.
The Dow Jones Industrial Average was off 0.1%, while the S&P 500 was down 0.2%, and the Nasdaq was flat. Most sectors were lower, with energy stocks very weak and consumer goods leading the market.
Mergers have been blasting individual stocks higher throughout 2015, and today was no exception for Pep Boys-Manny Moe and Jack (NYSE: PBY), Piedmont Natural Gas Company, Inc. (NYSE: PNY) and Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP), all of which became three of today’s best stocks.
Pep Boys (PBY)
PBY stock was in the driver’s seat today after announcing the company has been purchased by Bridgestone Americas (OTC:BRDCY), a division of Tokyo-based Bridgestone Corp (TYO:5108) for $835 million, or $15 per share in an all-cash transaction. PBY stock was up 23% on the day.
The deal was struck only four months after three directors were added to the board of PBY by activist investor Mario Gabelli. The deal is scheduled to close in the early part of 2016.
The $15 price was 23% above Friday’s closing price.
Piedmont Natural Gas Company, Inc. (PNY)
PNY stock was also on fire today, up more than 36% after announcing that Duke Energy has agreed to acquire PNY for $4.9 billion, or $60 in cash per share. That is a 40% premium to Piedmont’s closing price on Friday. Included in the deal, Duke will assume some $1.8 billion that Piedmont has in debt.
The deal will add a million retail electric customers to Duke Energy’s base, which already includes 7.3 million customers. The deal is expected to close by the end of 2016.
The merger was made a lot easier due to Duke and Piedmont having already partnered up in a $5 billion Atlantic Coast natural gas pipeline that will serve the coastal areas of North Carolina.
Ctrip.com International, Ltd. (ADR) (CTRP)
Not to be outdone, CTRP shares were booming today after the online travel company said it will form a partnership with Qunar Cayman Islands Ltd (NASDAQ:QUNR), which is controlled by Chinese Internet search website Baidu Inc (ADR) (NASDAQ:BIDU). As part of the deal, BIDU will now own 25% of Ctrip.com, while CTRP gets a 45% stake in Qunar.
Also helping out CTRP stock was Goldman Sachs Group Inc (NYSE:GS), also helped out CTRP stock, upping its rating on CTRP from “neutral” to “buy,” and setting a price target of $94 per share. Goldman Sachs very much approved of the deal, saying it will help both companies.
CTRP stock surged 22%. BIDU stock was also up more than 5%.
As of this writing, Ethan Roberts does not hold a position in any of the aforementioned securities.
