The stock market got off to a bad start to the new week on Monday, with major indexes finishing the session substantially lower. Investors remain nervous on multiple fronts, including uncertainty about whether the U.K. will be able to accomplish an exit from the European Union without further drama, fears of an overly zealous Federal Reserve, and ongoing tensions on the trade front between the U.S. and China. Yet a few stocks managed to avoid the market's downward pressure and posted gains. Fidelity Southern (LION), New Age Beverages (NBEV), and Playa Hotels & Resorts (PLYA -0.54%) were among the best performers on the day. Here's why they did so well.
Fidelity Southern takes this offer to the bank
Fidelity Southern saw its shares jump 16% after the Georgia-based bank got a buyout offer from Ameris Bancorp (ABCB -0.24%) for just over $750 million. Under the terms of the deal, Fidelity Southern shareholders will receive 0.8 Ameris shares for every share of Fidelity Southern they own, for an implied value of $27.22 per share based on last Friday's closing price. Ameris CEO Dennis Zember explained the move, noting that Fidelity Southern subsidiary "Fidelity Bank is the crown jewel of Atlanta, and we couldn't be more excited to partner with such a fine institution." The combination will create a banking powerhouse in the Southeastern U.S., continuing Ameris' recent spurt of acquisitions. Investors are hopeful that the post-merger bank will be able to stand up to larger competitors in the space.
Image source: New Age Beverages.
Legislation keeps lifting New Age Beverages
New Age Beverages stock picked up 12%, sustaining the upward momentum of the cannabidiol-infused drink specialist in the wake of important legislation passed by Congress last week. The latest version of the farm bill, which encompasses a huge swath of the agricultural industry domestically, included provisions that would legalize the production of hemp. Although stopping short of allowing cultivation and sale of cannabis itself at the federal level, the law could be the first step toward that end goal, at least in the view of those who are most interested in marijuana investing. The farm bill also has investors excited that further consolidation in the cannabis industry could produce a takeover bid for New Age, although it's just one of many companies that could attract a partner.
Playa does a big buyback
Finally, Playa Hotels & Resorts stock finished the day with a 7% rise. The operator and developer of all-inclusive resorts in the Caribbean and Mexico authorized a share repurchase program of up to $100 million, responding to recent weakness in its stock price. As CEO Bruce Wardinski sees it, "The dislocation in the market price of our shares is the result of material but temporary construction and renovation projects currently under way at three of our properties," and he thinks that makes the stock a good buy. Given Playa's lucrative partnerships with some key players in the hotel industry, shareholders seem to agree with Wardinski's call.
