Wall Street remained stuck in a holding pattern on Tuesday, with early gains for the Dow Jones Industrial Average (^DJI +0.24%) and S&P 500 (^GSPC +0.26%) giving way to further declines into bear market territory. Only the Nasdaq Composite (^IXIC +0.36%) managed to post a modest gain, but it still remains further below its all-time highs than its two benchmark counterparts.
|
Index |
Daily Percentage Change |
Daily Point Change |
|---|---|---|
|
Dow |
(0.43%) |
(126) |
|
S&P 500 |
(0.21%) |
(8) |
|
Nasdaq |
+0.25% |
+27 |
Data source: Yahoo! Finance.
Overall market sentiment remains cloudy as investors try to figure out whether macroeconomic headwinds are likely to make third-quarter earnings reports in October and November look ugly. Yet some institutions are keeping an eye out for bargains among stocks, and companies are looking for collaborations that can be lucrative for everyone involved.
Those themes were part of what sent shares of Ryder System (R +4.40%) and AerCap Holdings (AER 3.25%) higher today, and as you can see below, the gains could be just the beginning of bigger moves for the two companies.
Another buyout for Apollo?
Shares of Ryder System were up almost 15% on Tuesday. Most of the gains for the transportation stock came late in the day, after reports came out that the moving truck and logistics company might be the latest potential target of a well-known institutional investor.
Apollo Global Management (APO +0.22%) could be looking at a prospective takeover of Ryder System, according to reporters from Bloomberg. The reports lacked any details of what the possible terms of a deal might be, but investors are clearly assuming that Apollo would need to pay a hefty premium to the company's market capitalization as of Monday.
NYSE: R
Key Data Points
Ryder hasn't been too open to interest from institutions looking to take it private. In June, Ryder rejected a $4.4 billion takeover bid from HG Vora Capital Management, which had accumulated a nearly 10% stake in the transportation, equipment rental, and logistics company. At the time, Ryder said that it believed it could maximize shareholder value by remaining an independent business, but the stock has been volatile in the months since then.
Ryder's valuation looks extremely attractive, given the big boom in its earnings recently. Even if profits pull back somewhat, Ryder stock could still have further to move higher, especially now that opportunistic investors have their eye squarely on the company.
AerCap celebrates with Boeing
Elsewhere, shares of AerCap Holdings rose 5%. The aircraft leasing company hit a milestone in its relationship with Boeing (BA 2.08%), and AerCap hopes that its efforts will pay off as interest in cargo shipping remains at high levels.
AerCap and Boeing reported the delivery of the 100th 737-800 converted freighter aircraft on Tuesday. The conversion took place at Boeing's Shanghai conversion line. In turn, AerCap has leased the aircraft to Latin American logistics company Gol Linhas (GOL +0.00%), which in turn will operate the freighter for rising e-commerce marketplace provider MercadoLibre (MELI 2.71%), based on the logo painted on the aircraft.
NYSE: AER
Key Data Points
The delivery gives AerCap the largest fleet of converted 737-800BCFs, and the company still has 65 firm orders and nine options pending with Boeing. Boeing touted the greater fuel efficiency and higher utilization of its planes compared to older freight planes.
With airlines strapped for cash, aircraft leasing could rise in popularity in the coming years. That would put AerCap in a commanding position as the industry leader, with more opportunities for further profits ahead.
