Please ensure Javascript is enabled for purposes of website accessibility

Why McDermott International, Scholastic, and California Resources Jumped Today

By Dan Caplinger – Sep 20, 2019 at 4:29PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

These stocks bucked a downward trend on Wall Street.

Friday saw modest losses for the stock market, largely in response to some troubling news on the trade front between the U.S. and China. Chinese trade officials canceled a planned visit to Montana, leading some to fear that what seemed to be thawing relations with the U.S. might be starting to get colder again. Even with that dragging down the major benchmarks, some stocks saw sizable gains. McDermott International (MDR), Scholastic (SCHL -4.16%), and California Resources (CRC) were among the top performers. Here's why they did so well.

McDermott looks to raise cash

Shares of McDermott soared nearly 27% as investors weighed news that the energy engineering specialist was looking at potentially selling one of its business units in order to raise cash. McDermott had seen steep declines in its stock price recently because some were nervous about the company's decision to consult with outside advisors, reportedly contemplating a turnaround strategy. Today, reports surfaced that the company might sell its petrochemical technology division, Lummus Technology, to raise cash. With some seeing a potential payday of $2.5 billion in a sale, that would go a long way toward allaying any fears shareholders might have about outright insolvency at McDermott.

Oil refinery near a body of water on an overcast day.

Image source: Getty Images.

Scholastic takes bears to school

Education and publishing company Scholastic saw its stock pick up almost 6% in the wake of its fiscal first-quarter financial report. Scholastic said that revenue rose 7% from year-ago levels, and although the company routinely reports losses during the out-of-school summer months, the current-period net loss was 5% smaller than what it lost during the same period a year earlier. The company also reiterated its past guidance for the full year. CEO Richard Robinson pointed to best-selling book titles, building out digital capabilities, and managing costs as key contributors to Scholastic's performance, and investors hope it will be able to sustain its positive momentum.

California Resources reassures investors

Finally, shares of California Resources finished higher by 13%. Some investors had heard reports that the energy company might need to restructure its operations and hire outside advisors to help it through the process. However, that proved not to be the case, as California Resources itself denied the statements. Even with today's gains, though, the stock is still quite a bit below where it was before the initial allegations came out. That suggests that some investors aren't sure what to believe, and it could take more time for this story to play out entirely -- especially as the energy sector remains volatile.

Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Scholastic Corporation Stock Quote
Scholastic Corporation
SCHL
$29.48 (-4.16%) $-1.28
McDermott International, Inc. Stock Quote
McDermott International, Inc.
MDR
California Resources Corporation Stock Quote
California Resources Corporation
CRC

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
326%
 
S&P 500 Returns
102%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/04/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.