It was a mixed day on Wall Street, with traders responding to rumors and awaiting word from the Federal Reserve meeting tomorrow and upcoming GDP numbers.
Stocks dropped quickly while energy and gold soared, after news that Iran had seized a Western cargo carrier led to speculation of it being a U.S. ship. That report later proved to be erroneous and stocks rebounded after that, while energy and gold pared back their gains.
Elsewhere, the Conference Board’s consumer confidence survey came in at 95.2 for April, which was a decline from March and well below estimates for 102.5. In fact, it was the lowest reading since December.
On the housing front, the February S&P/Case-Shiller index of 20 cities gained 5% year-over-year, and was 0.5% improved from January’s reading.
By day’s end, the Dow Jones Industrial Average had risen 0.4%, the S&P 500 was 0.3% higher, but the Nasdaq Composite lost 0.1%. Almost every sector was green today, but basic materials and finance were well ahead of the others.
Traders continue to scrutinize earnings, and reward those companies who meet or exceed estimates. That is exactly why Merck & Co., Inc. (NYSE:MRK), JetBlue Airways Corporation (NASDAQ:JBLU) and Rent-A-Center Inc (NASDAQ:RCII) are three of today’s best stocks.
Merck & Co., Inc. (MRK)
MRK stock rose 5% after reporting first quarter adjusted earnings of 85 cents a share, easily surpassing analysts’ estimates of 75 cents a share. Revenue for the New Jersey-based drug manufacturer was $9.4 billion, also ahead of forecasts for $9 billion.
Merck’s two biggest drugs, Januvia and Janumet, led MRK’s prescription drug sales of $8.3 billion. Merck’s vaccines and HIV drug Isentress also showed strong sales.
Prior to today, MRK stock had been a market laggard in 2015, but things are looking up after today’s report.
JetBlue Airways Corporation (JBLU)
JBLU stock was also flying higher today by 6.6% after posting first-quarter earnings of 40 cents a share, in line with Wall Street estimates and a big improvement over 1 cent a share a year ago.
Although revenue of $1.5 billion was 13% higher than a year ago, it was just below the Street’s estimate. Still, the big improvements over a year ago were what the Street was looking for, and JBLU is seen by analysts as one of the best stocks in the airline sector.
JBLU stock has resembled a textbook straight line uptrend from $12 November to today’s closing price of $21.01.
Rent-A-Center Inc (RCII)
RCII stock blasted up 13.6% higher today after reporting first-quarter earnings of 52 cents a share, 7% lower than a year ago, but a few cents ahead of Wall Street estimates.
Revenue came in at $877.6 million, up almost 6% from a year ago and above the Street’s view of $859 million. RCII’s has a new “Acceptance NOW” program, where the customer, with no credit check, can select any furniture they like from one of RCII’s many affiliate retailers. RCII then buys the furniture and leases it to the customer. Acceptance NOW has been a strong factor in Rent-A-Center’s improved bottom line since the program was initiated.
RCII stock was up strongly yesterday in anticipation of an earnings beat, but then sold off a large portion of its gains in the last hour before the bell as traders bet the earnings report wouldn’t be all that terrific.
Looks like they were wrong.
As of this writing, Ethan Roberts does not hold a position in any of the aforementioned securities.