Why Sears Holdings, DaVita HealthCare Partners, and Universal Insurance Holdings Soared Today

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

News of a diplomatic solution to the long-running standoff over the Iranian nuclear program helped stocks off to a good start, but concerns about the coming holiday season made traders less willing to bet on a short-term melt-up in the market. Despite the whipsawing in the overall market, though, Sears Holdings (NASDAQ: SHLD  ) , DaVita HealthCare Partners (NYSE: DVA  ) , and Universal Insurance Holdings (NYSE: UVE  ) all held onto sharp gains for the day. Let's take a closer look at all three to see why they fared so well and whether their gains can continue.

Sears Holdings gained 7% on an initial report from the New York Post that the retailer was talking to investment bankers about a potential sale of its interest in the Sears Canada retail chain. Sears issued a press release later in the day saying that the Post article includes several factual errors, including statements that Sears is conducting a "beauty contest" for Sears Canada and that it has talked to investment bankers about the Canadian department store. Regardless, shares moved higher during the afternoon hours. Investors seem to understand that the strategy that Sears is following involves considerations such as strategic sales of business units to a greater extent than actual retail prowess, and today's stock-price action reflects that fact.

DaVita picked up 9% as the Centers for Medicare and Medicaid didn't cut reimbursement rates on payments to dialysis clinics as dramatically as investors had expected. Although proposed cuts could have resulted in double-digit percentage declines in dialysis payments, the actual solution involves a much smaller 1% cut over the next two years. Obviously, any cut is bad news for DaVita, but less-bad news is better than worse news.

Universal Insurance rose 10% as the small insurance company announced a special dividend of $0.15 per share to go with its regular $0.08-per-share quarterly payout. The insurer has more than doubled in value this year, and the company got good news last week from the New York Stock Exchange, which will allow it to trade there rather than on the NYSE MKT site beginning Dec. 3. With more than ample profits to cover the payouts, Universal Insurance seems poised for further growth, especially if this year's quiet hurricane season repeats in future years to keep losses down.

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