The stock market generally retreated on Wednesday, although major benchmarks were mixed. The Nasdaq resumed its weakness, falling half a percent, but the Dow actually managed to gain ground on strength in the home-improvement retail and insurance sectors. The Federal Open Market Committee's decision to raise interest rates by a quarter-percent dominated investors' attention, disappointing those who had expected a more dovish result from the central bank. Weakness in the crude oil market also weighed on sentiment, but some stocks managed to overcome the downbeat mood and post good gains. SeaWorld Entertainment (SEAS 0.68%), Brookdale Senior Living (BKD -0.61%), and Epizyme (EPZM) were among the best performers on the day. Below, we'll look more closely at these stocks to tell you why they did so well.
Will SeaWorld get new leadership?
SeaWorld Entertainment stock gained almost 7% after reports surfaced that shareholders had voted to withhold their approval for board chairman David D'Alessandro to remain on the marine theme park's board of directors. SeaWorld has been suffering from slow attendance, and some shareholders have been less than happy about the fact that D'Alessandro and other key executives have received equity incentive compensation in the form of restricted shares. One proxy advisory company had recommended that shareholders withhold support for D'Alessandro as a result, and if the reports are correct, it's clear that investors have responded. SeaWorld investors have to hope that regardless of what happens to D'Alessandro going forward, the company has received the message loud and clear that no corporate insider is safe if SeaWorld's performance doesn't improve.
Image source: SeaWorld Entertainment.
Will Brookdale get bought out?
Shares of Brookdale Senior Living jumped 8% in the wake of reports that the senior community operator is likely to receive a buyout bid. China's Zhonghong Zhuoye Group, which coincidentally took a more than 20% equity position in SeaWorld recently, is reportedly looking at acquiring Brookdale, with Zhonghong having started with an offer of $3 billion. As with any acquisition from a Chinese company, some investors are concerned that the deal might not get the approval of the U.S. federal government, whose Committee on Foreign Investment in the U.S. has veto power over such transactions. Brookdale has seen price spikes on takeover speculation before, and investors will want to see what actually surfaces before assuming that the Chinese real estate company will follow through with an actual bid.
Epizyme reports positive drug data
Finally, Epizyme stock climbed 11%. The clinical-stage biopharmaceutical company released favorable results from its phase 2 clinical trial of lymphoma treatment tazemetostat. The interim data showed that tazemetostat produced extremely strong objective response rates in patients with follicular lymphoma and promising results in patients with diffuse large B-cell lymphoma. The treatment's safety profile remains favorable as well, and Epizyme's CEO said that the company's "focus is on continuing to increase enrollment of patients with an EZH2 mutation and engaging with the FDA in the second half of the year to determine potential registration paths to bring tazemetostat to patients as quickly as we can." With the treatment just having won fast-track status in April, Epizyme is keeping up the momentum to the maximum extent possible.
