The bulls got the new week started on an even more bullish foot than they ended last week on, as the S&P 500 gained another 0.3%. The close at 2,129.20 took the large cap index decidedly into new-high — and record-high — territory.
It wasn’t a banner day for all stocks, however. Endo International plc (NASDAQ:ENDP), Ascena Retail Group Inc. (NASDAQ:ASNA) and JA Solar Holdings Co., Ltd. (NASDAQ:JASO) were all deep in the red on Monday. Here’s what happened to each.
JA Solar Holdings (JASO)
The good news: JA Solar Holdings topped its earnings estimates for last quarter. The bad news: It failed to live up to revenue expectations in the first quarter of 2015. The market opted to see the glass as half-empty rather than half-full, sending JASO shares down nearly 6%.
Last quarter, JA Solar Holdings earned 13 cents per share, versus analyst forecasts for a profit of six cents per share of JASO stock. Revenue of $387.7 million, however, fell well short of the expected top line of $410 million.
Low energy commodity prices (like oil, natural gas, and coal) have crimped demand for solar panels. Shipments of panels fell 3.1% in Q1. But, JA Solar Holdings expects demand to perk up again in the second half of 2015.
Endo International (ENDP)
Pharmaceutical company Endo International is doing its part to prolong a wave of M&A within the industry. Judging from the 5% drop ENDP doled out today, though, investors aren’t impressed.
The mostly-cash deal brings Par Pharmaceuticals into the Endo fold, costing $8.05 billion, and creating a company that will be one of the United States’ top-five generic drug giants by adding Par’s $1.3 billion worth of revenue to Endo International’s top line.
Though touted by Endo International and analysts as a good fit, ENDP investors may silently be wondering if Endo is overpaying just to do a deal — any deal — after being outbid by Valeant Pharmaceuticals (NYSE:VRX) for Salix in March.
Ascena Retail Group (ASNA)
Speaking of deals the market isn’t thrilled about, retail store operator Ascena Retail Group saw its stock fall a full percentage point on Monday following news that it would be acquiring Ann Inc. (NYSE:ANN) — as in Ann Taylor stores — to the tune of $2.16 billion.
Ascena Retail Group, which operates DressBarn and Lane Bryant, will add $2.5 billion to its annual top line with the union, based on last year’s results from Ann. The Ann Taylor parent company also earned $68 million on that $2.5 billion in sales in 2014. It’s not a lot, though it was an off-year for Ann. The company had earned well over $100 million per year in the two years prior to last year.
Either way, ASNA believes it can generate a cost-savings of $150 million per year by combining the two companies. Investors, however, seem to be more concerned this is going to be an expensive deal, a misfit, or both.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
