The stock market continued to gain ground on Thursday, and most investors attributed the move higher to carryover buying interest following the Federal Reserve's Wednesday decision to keep interest rates unchanged. The SPDR S&P 500 ETF (NYSEMKT:SPY) rose about 0.6%, mirroring gains from most major market benchmarks.
In general, investors appear to be gearing up for the coming earnings season to get a better gauge on how things went during the third quarter, and a return to lower volatility might be taking shape. Yet some stocks posted big gains, and among the best performers were SeaWorld Entertainment (NYSE:SEAS), Caesars Entertainment (NASDAQ:CZR), and Steelcase (NYSE:SCS).
SeaWorld rebounds from its dividend cut
SeaWorld Entertainment jumped 8% after investors reversed course in their assessment of the company's future direction. Earlier in the week, SeaWorld shares fell after the company decided to suspend its dividend, leaving open the possibility of buying back stock, but still disappointing dividend investors. Yet comments from analysts following the dividend decision have pointed out that having more cash on hand could allow SeaWorld to reinvest in its own business, which in turn could help boost growth prospects and be a long-term win for the company.
Moreover, even to the extent that SeaWorld simply diverts some of what it would have paid in dividends toward buybacks, the net impact on the share price should be roughly the same, and it could also benefit from better earnings per share due to a falling share count. Going forward, SeaWorld needs to establish how it can win customers back in order to make its strategy successful.
Caesars could be close to a win
Caesars Entertainment climbed another 21%, marking its second straight day of 20%+ gains after reports indicated that the casino company will likely win the approval of stakeholders in its latest plan of reorganization for its bankrupt operating subsidiary. Yesterday, along with its private equity partners, Caesar's said it would make a big boost to the amount that creditors would be able to claim as part of bankruptcy proceedings, seeking to avoid further litigation against the Caesars Entertainment parent. If the deal goes through, then a big threat to Caesars Entertainment would essentially disappear, and investors are hoping that reports thus far are true.
Steelcase climbs despite mixed results
Finally, Steelcase gained 13%. The maker of furniture and integrated architectural products reported its second-quarter results Wednesday night, and even though some of its performance was mixed, investors celebrated the news. Sales fell 7.5%, to $768 million, and adjusted earnings of $0.32 per share were down almost 9%. Yet investors took solace from comments indicating that the early part of the third quarter had seen a pickup in business activity, especially within its key Americas segment.
Given that the industry has looked for a bounce for some time, even the hint of a turnaround was enough to make Steelcase shareholders look forward to a possibly brighter future.