Why SunPower, Itron, and Tenet Healthcare Jumped Today

Even as the stock market plunged, these three stocks performed strongly Friday. Find out more about what made them soar.

Apr 25, 2014 at 8:05PM

On Friday, the stock market gave up all of its gains for the week and then some, as earnings scares sent many popular stocks downward, and rising tensions between Ukraine and Russia brought back geopolitical risk into the investing equation. Major market benchmarks finished the day with losses of as much as 2%, but SunPower (NASDAQ:SPWR), Itron (NASDAQ:ITRI), and Tenet Healthcare (NYSE:THC) bucked the downward trend to post solid gains on the day.


Source: SunPower.

SunPower rose 7% as the solar giant once again crushed expectations. Revenue gained 19%, and extremely strong net margins of 11% led to adjusted net income of $0.49 per share. Yet, as Fool solar specialist Travis Hoium pointed out earlier today, SunPower could have even more value than investors believe, as its practice with respect to the future value of some of its assets is more conservative than the tack some of SunPower's competitors take. Given that SunPower has already demonstrated its ability to top the industry in areas like efficient technology and growth potential, today's pop could be just the beginning of a longer-term uptrend for SunPower stock.

Itron jumped 11% as the company behind smart-metering solutions for electric, gas, and water utilities and their customers reported favorable results for its first quarter. Revenue climbed 6%, surprising investors who had expected a slight decline in sales from the company, and earnings per share came in $0.05 higher than shareholders had anticipated. Still, investors expect sales to continue to decline throughout the rest of 2014, and unless Itron can build up some positive momentum from this quarter's solid results, the stock's bounce could prove to be a purely temporary phenomenon.

Tenet Healthcare gained 9% on a strong day for hospital stocks generally. Although some of Tenet Healthcare's peers reported earnings today, the upward momentum for Tenet and hospital stocks appeared to come more from optimism about the prospects for more favorable Medicare and Medicaid reimbursement policies than some investors have feared. Lawmakers recently punted the hot-button issue another year into the future, passing a one-year patch that delayed implementation of what would have been 24% cuts in Medicare reimbursements for doctors this year. But the real question for Tenet and its peers is whether permanent reform will have a positive or negative impact on their business models, especially as the Affordable Care Act takes root within the nation's medical system.

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Dan Caplinger has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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