The stock market gained ground on Wednesday, buoyed by enthusiasm about the potential for continued U.S. economic growth. Prospects elsewhere around the world have been increasingly cloudy, especially in light of U.K. Prime Minister Boris Johnson's planned move to support a no-deal Brexit later this year. Yet investors have higher expectations domestically, and good news from key sectors of the economy contributed to positive market sentiment. Tallgrass Energy (TGE), Chico's FAS (CHS), and Dycom Industries (DY 0.63%) were among the top performers. Here's why they did so well.
Tallgrass gets taken out
Shares of Tallgrass Energy soared 35.5% after the energy company got a buyout bid from private equity specialist Blackstone Infrastructure Partners. Under the terms of the deal, Tallgrass investors would receive $19.50 per share for their interests in the pipeline company, representing a substantial premium to the $14.35 per share price for the stock as of Tuesday afternoon. Blackstone and its partners and affiliates already hold about 44% of the economic interest in Tallgrass, and taking complete control would give Blackstone more flexibility in managing the energy company. Consolidation in the energy industry has been rampant, and this would mark just one more deal to combine key players in the market.
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Chico's gains momentum
Chico's FAS saw its stock climb nearly 21% following its release of second-quarter financial results. The retailer broke even on an adjusted basis despite sales dropping almost 7% from year-ago levels, and unexpected strength from the company's Soma concept helped to offset weakness from its White House Black Market and namesake Chico's segments. Newly appointed CEO Bonnie Brooks predicted that strength at Soma would continue, and healthy fall and holiday seasons are likely to keep the company moving in the right direction. Even with today's move higher, however, Chico's has still lost about half its value since the beginning of 2019.
Dycom keeps moving forward
Finally, shares of Dycom Industries jumped 9%. The specialty contractor reported an 11% rise in organic contract revenue in its second quarter, and adjusted net income inched higher by about 4% year over year. The company's outlook for the third quarter also looks reasonably favorable, with solid performance expected both for revenue and profit. Investors have been pleased to see Dycom take advantage of opportunities to help in the installation of network infrastructure to improve broadband performance. With the company repeating its success from the first quarter, Dycom's business looks primed to stay healthy throughout the year and beyond.
