Tuesday saw a good session for the stock market, as major benchmarks climbed more than 1%. Investors were pleased with news out of Washington that lawmakers had apparently found an agreement in principle to fund the federal government, avoiding the potential for yet another government shutdown within the next few days. Favorable news concerning trade talks with China also lifted sentiment, and several companies reported good earnings results or takeover interest. Under Armour (NYSE:UA) (NYSE:UAA), Ellie Mae (NYSE:ELLI), and Coty (NYSE:COTY) were among the top performers. Here's why they did so well.
Under Armour gets fit
Class A shares of Under Armour jumped 7% after the athletic apparel and footwear company reported its fourth-quarter financial results. Revenue was up just 2% in the holiday quarter, but a big boost to gross margin figures showed the positive results of efforts to contain costs and reduce the amount of promotional activity necessary to sell its inventory. CEO Kevin Plank put the results in perspective, noting that they "demonstrate significant progress against our multi-year transformation toward becoming an even stronger brand and more operationally excellent company." The numbers validate shareholder optimism about Under Armour, and further gains look possible if the athletic apparel maker can keep moving forward with its restructuring efforts.
Ellie Mae gets a buyout bid
Ellie Mae saw its stock soar more than 20% after the mortgage software specialist agreed to a purchase offer from a private equity investment company. Thoma Bravo offered $3.7 billion to buy Ellie Mae, with the all-cash deal potentially paying investors $99 per share in cash for their Ellie Mae stock. CEO Jonathan Corr was happy with the deal, noting that "as we enter this next phase of our digital mortgage journey, we are thrilled to provide immediate value to our shareholders." Yet not everyone's happy about the deal, as even though the $99 price is above where the stock has traded recently, it's well below the highest prices the stock reached during 2017 and 2018.
Coty sees interest from a big shareholder
Finally, shares of Coty rose 12.5%. The beauty specialist behind brands like Cover Girl got a proposal from major shareholder JAB Holding, which already owns a 40% stake in the company. Under the terms of the deal, JAB would invest $1.75 billion in order to acquire an additional 150 million shares of Coty, paying $11.65 per share for the stock. That'd push JAB's stake in Coty to 60%, and it provides further confidence in the cosmetics company's prospects. Given that shareholders were already pleased with Coty's most recent financial results when it reported late last week, the move from JAB is just icing on the cake.