U.S. markets were pressured on Friday to close out the week thanks to some weaker-than-expected economic reports and continuing concerns about Greece’s solvency.
The Greek government continues to say that an accord is imminent, but officials in the International Monetary Fund (IMF) and others deny that any such deal is close, and that Greece could still default. On the U.S. economic front, we saw declines in Chicago PMI, the University of Michigan’s Consumer sentiment reading for May and revised first-quarter GDP.
It might have been surprising, then, that today’s selloff was only minor — or just a sign that investors think the data will keep the Fed from raising interest rates anytime soon. The Dow Jones Industrial Average and S&P 500 were off 0.6%, while the Nasdaq was 0.5% lower. All major sectors were in the red.
Despite the overall weakness, there were some bright spots among individual issues. Here’s why GameStop Corp. (NYSE:GME), Altera Corporation (NASDAQ:ALTR) and Magnachip Semiconductor Corp (NYSE:MX) were among Friday’s best stocks.
GameStop Corp. (GME)
GameStop — a fairly unloved company, if you’re looking at short interest — enacted some revenge on the Street after reporting better-than-expected first-quarter earnings.
GME grew earnings by 15% year-over-year to 68 cents per share, which was enough to beat the Zacks Consensus Estimate by a dime. Revenues of $2.06 billion grew a modest 3.2% YoY, but also topped Wall Street estimates for $2.01 billion. Sales were higher thanks to popular new titles and downloadable content.
Friday’s 6% climb brings GME stock’s year-to-date gains to 28%.
Altera Corporation (ALTR)
Altera Corporation was the subject of one of the week’s biggest M&A headlines. ALTR stock was up 4% amid reports that Intel Corporation (NASDAQ:INTC) and Altera have resumed talks, and are closing in on a deal. The price tag for Altera? $16 billion.
The deal, which supposedly would price ALTR stock at $54 per share, is very similar to one which ALTR turned down in April after several months of negotiations.
The deal is the second major semiconductor bid of the week. Avago Technologies Ltd (NASDAQ:AVGO) put in a successful $37 billion bid to purchase Broadcom Corporation (NASDAQ:BRCM) as well.
Magnachip Semiconductor Corp (MX)
Another big move in semiconductors came courtesy of Magnachip. MX stock roared 12% higher after reporting a Q1 loss of 28 cents — 10 cents better than analysts’ expectations. In fact, MX’s move also came amid a roughly 8% miss on revenues. (Wall Street expected sales of $179.55 million.)
The news was met with an upgrade from Topeka Capital Markets from “hold” to “buy,” as well as a $9 price target — 25% higher from current prices.
As of this writing, Ethan Roberts did not hold a position in any of the aforementioned securities.
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