Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
The coast into the end of the year has begun, with many investors on vacation and little in the way of economic data to speak of until later this week.
The only notable piece of data today came from the National Association of Realtors, which noted that the Pending Home Sales Index inched higher by 0.2% to a reading of 101.7 for November. This is the first time this index has moved up since May and speaks to just how important low lending rates are to driving home purchases. Even though 30-year mortgage rates are still historically low by all measures, the spoiled U.S. consumer has been impatiently sitting on his or her hands waiting for even lower rates which may not come.
With few catalysts and volume generally weak, the broad-based S&P 500 (^GSPC +0.77%) was stuck within a very tight trading range all day and ended fractionally lower once again, dropping 0.33 points (-0.02%) to close at 1,841.07. However, just because the S&P 500's move was tame doesn't mean the following three companies weren't lighting things up.
Stepping over the competition today was Crocs (NASDAQ: CROX), which gained 21.1% after a subsidiary of Blackstone (BX +0.00%) announced a $200 million investment in the footwear retailer. The terms of the investment include Blackstone's purchase of $200 million in Series A convertible preferred stock that can be converted to common stock at $14.50 per share, as well as Blackstone picking up two seats on Crocs' board of directors. The investment will help fund a proposed $350 million stock repurchase program that will lower Crocs' shares outstanding and help boost earnings per share. In addition, CEO John McCarvel announced his intentions to retire by or before April 30, 2014. Finally, Crocs also issued relatively weak fourth-quarter guidance, pushing investors to expect the low end of its previous $220 million-$225 million sales forecast and EPS loss of $0.20-$0.23 per share. While the investment news is a quick boost for Crocs shareholders, I still don't see any long-term catalysts to turn its struggling footwear business around.
China-based NQ Mobile (NYSE: NQ) advanced 17.3% after Morgan Stanley today disclosed a passive 5.2% stake in the mobile Internet services and security provider via a 13G filing. While this shouldn't be interpreted as any intent by Morgan Stanley to exert control over NQ's day-to-day operations, investors are clearly thrilled to see a heavyweight Wall Street firm purchasing its shares. If you recall, just two months ago NQ Mobile imploded following an 80-page report from noted short-seller Muddy Waters that accused the company of fraud and reporting false partnerships. Until we have better clarity of which party is in the right, even with Morgan Stanley taking a position, it might be best to stick to the sidelines.
Finally, shares of electric vehicle and all-terrain vehicle manufacturer Kandi Technologies (KNDI +5.98%) surged again, gaining 15.6% on the heels of comments made last week that its electric vehicle sales may surpass the sales total of its other vehicles combined. EVs are red hot at the moment, with Tesla Motors having successfully introduced the first mass-produced new car brand in 50 years. The fact that Kandi is up nearly 60% over just the past five sessions is testimony to that. However, much of that optimism has likely been baked into Kandi's share price here, and it might be prudent for investors to wait for the company's bottom line to do the talking.
