The stock market came out of Labor Day weekend on a sluggish note, but it recovered ground by the end of the session to finish close to where it had started. Lingering doubts about the status of trade discussions with key trading partners initially caused major benchmarks to fall around half a percent in the morning. Once again, though, stocks proved their resiliency, and investors seemed more comfortable with the idea that corporate earnings would remain strong at least through the end of the year. Moreover, some strong showings from key stocks helped lift sentiment. Advanced Micro Devices (AMD +5.64%), Ballard Power Systems (BLDP +2.85%), and El Pollo Loco Holdings (LOCO 0.43%) were among the best performers on the day. Here's why they did so well.
AMD gets even more analysts on its side
Shares of Advanced Micro Devices climbed more than 11% after multiple analysts at key investment companies added to the chipmaker's momentum. Analysts at Cowen boosted their price target on AMD from $25 to $30 per share, noting that the company has demonstrated an ability to catch up with rival Intel in certain areas and surpass it in others in the near future. Meanwhile, Jefferies analysts repeated their buy rating on the stock, making an even bigger $8 increase to their price target, matching Cowen's $30 target on the idea that AMD has some key advantages over Intel and can take share in certain hardware niches. How much further AMD can soar is hard to predict, but for now, shareholders love what they're seeing.
Image source: Ballard Power Systems.
Ballard powers up
Ballard Power Systems stock rose 9% in the wake of yet another major strategic move. Following last week's decision to collaborate with a key Chinese partner, the fuel-cell specialist said late Friday that it would sell off some of its power-manager business assets to privately held Revision Military for as much as $16 million. Under the terms of the deal, an up-front $4.75 million payment will be followed by as much as $11.25 million depending on the unit's sales over a 12-month period. With the sale, Ballard is moving forward with its planned divestment of non-core assets as it seeks to pursue a more focused approach toward maximizing its fuel-cell success.
Investors see value in El Pollo Loco
Finally, shares of El Pollo Loco Holdings gained almost 10%. The restaurant chain announced over the holiday weekend that it would introduce four new value-priced combination meals, known as $5 Craveable Combos, in order to help "customers to satisfy their cravings with a price that also satisfies their wallets." With items including handmade chicken taquitos, El Pollo Loco is trying to jump into the healthy-food craze, and as company executive chef Heather Gardea explained, "We are excited to offer our customers new crave-worthy meals that are made with ingredients we prepare by hand each day." Investors like the move, and even though the Mexican food space is pretty crowded, it's good that El Pollo Loco is taking its shot at making a bigger impact in the industry.
