The stock market dropped sharply on Tuesday, with the Dow Jones Industrial Average falling as much as 550 points before regaining some of its lost ground. Investors were nervous about several issues, including the threat of slower growth in China, higher interest rates in the U.S., and tepid forecasts from major U.S. multinationals in the industrial sector. Yet even as major benchmarks slumped about a half-percent, some companies enjoyed some good news that sent their shares higher. Tesla (NASDAQ:TSLA), McDonald's (NYSE:MCD), and PulteGroup (NYSE:PHM) were among the best performers on the day. Here's why they did so well.
Tesla gets a Citron boost
Shares of Tesla climbed 13% after the electric-car manufacturer saw one of its critics have a change of heart. Andrew Left of Citron Research is notorious for selling stocks short, and Tesla was one of his targets earlier in the year. Yet today, Citron reversed course, saying that the automaker is "destroying the competition" and stands to remain a leader in the field. With Tesla set to report its latest results on Wednesday, investors will need to see if the company's actual performance can live up to Citron's positive comments -- but given how much negative publicity Tesla's gotten, today's news was a nice change of pace for hard-hit shareholders.
McDonald's looks golden
McDonald's stock picked up 6% in the wake of the company's release of third-quarter financial results. The fast-food giant saw global comparable sales climb 4.2%, and although overall revenue dropped 7%, most of those declines came from the company's ongoing strategic refranchising initiative. After accounting for one-time items, adjusted earnings per share were up 19%, and McDonald's also said it would raise its dividend by 15% to $1.16 per share on a quarterly basis. CEO Steve Easterbrook was pleased with the moves that McDonald's has made, noting that "we have made substantial progress modernizing restaurants around the world, enhancing hospitality and elevating the experience for the millions of customers we serve every day." Even as customers demand more, McDonald's has been able to keep up with its competitors and deliver good value.
Pulte gets through headwinds
Finally, shares of PulteGroup rose 7%. The homebuilder reported solid results in its third-quarter financial report, including a 17% rise in home closings to more than 6,000 and a 25% rise in revenue from home sales. Net income soared by nearly three-quarters thanks to margin expansion, and even with higher interest rates, backlog figures were up slightly from comparable figures last year. "While buyer concerns around affordability and rising mortgage rates appear to have impacted near term market dynamics," CEO Ryan Marshall said, "traffic trends indicate that buyer interest levels are still high and that the overall housing recovery remains on track." That's good news not just for PulteGroup but for the entire homebuilding industry, which has been under pressure lately due to worries about interest rates and the economic environment.