On Monday, the stock market moved higher, with small-cap stocks finally outperforming their larger counterparts as investors turned their attention away from a largely successful earnings season and toward other factors, including merger and acquisition activity and economic data. Compared to the modest gains for the overall stock market, though, the jumps in Zendesk (ZEN), Trulia (NYSE: TRLA), and Yingli Green Energy (NYSE: YGE) looked fairly impressive.
Source: Yingli Green Energy.
Zendesk rose 8% as investors continued to evaluate the newly public provider of automated customer-service solutions. By offering subscriptions to enterprise clients, Zendesk hopes to take the burden of dealing with customers off its clients' shoulders, and the stock has now climbed more than 80% from its $9 offering price. There's no doubt that Zendesk has plenty of potential as the move to cloud-based solutions increases, but Zendesk also faces substantial competition from both well-established veteran players in the industry as well as other new start-ups with similar aspirations. Zendesk will need to prove itself in order to justify its opening share-price run, but it has the advantage of having a strong fundamental business opportunity in front of it.
Source: Trulia.
Trulia climbed 6% on a generally strong day for stocks related to the online real-estate industry. Thanks in large part to improving conditions in the housing industry generally, Trulia has experienced accelerating growth in popularity for its online website, scoring 50 million unique visits in the month of April to put an exclamation point on its impressive growth rate. With impressive gains not just in monthly unique users overall but also in the key mobile segment, Trulia is working hard to secure potential real-estate buyers. Moreover, with strong gains in the number of real-estate professional subscribers to the site, Trulia is making sure it fills both ends of its funnel to build up a strong network effect.
Yingli Green Energy gained about 7.5%, as Chinese solar stocks enter the spotlight with some important earnings reports in the space. Yingli and its peers have had impressive gains as the prospects for the Chinese solar industry have improved dramatically. Investors still expect huge orders from Chinese government entities, and that has helped Yingli Green Energy get closer to profitability. Even so, Yingli faces some ongoing challenges, as some of its peers are further along than it is in terms of margins and balance-sheet health. Among players in the Chinese solar industry, Yingli is on the edge, and it needs to stand up to its competitors and find ways to bolster the efficiency of its modules in order to take full advantage of growth in solar demand both within China and in other key areas such as Europe and Japan. Today, though, shareholders are confident that Yingli can get the job done.
