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Why SolarCity, Terex, and Weight Watchers International Jumped Today

By Dan Caplinger - Jan 26, 2016 at 8:19PM

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These stocks helped the market soar. Find out why.

Image: SolarCity.

The stock market's topsy-turvy ride in 2016 continued on Tuesday, this time climbing to regain most of the ground it lost on Monday. Renewed strength in oil prices had the typical impact on the oil and gas sector, but many other stocks also managed to post substantial gains as a combination of earnings results, merger and acquisition activity, and other company-specific news lifted individual companies' prospects higher. Among the best performers on the day were SolarCity (SCTY.DL), Terex (TEX -1.13%), and Weight Watchers International (WW -15.80%).

SolarCity jumped 12% after the residential-solar giant announced Monday night that it had closed a new financing facility late last week. The company said that it worked with BofA Merrill Lynch and other financial institutions to set up the $160 million, five-year facility, and the available credit will help SolarCity with about 195 megawatts of residential solar project financing. In combination with the efforts that it has made to securitize solar loans -- efforts that resulted in the solar asset-backed bonds getting an investment-grade rating -- SolarCity is working hard to maximize its opportunities for growth even as certain jurisdictions look at changes to net-metering laws that could endanger its long-term business model.

Terex soared 37% after the lifting and materials-handling solutions company got an unsolicited proposal from Zoomlion to acquire the company for $30 per share in cash. The Chinese acquirer's move comes as a surprise to Terex, which had already agreed to combine with Finnish competitor Konecranes last August in a stock deal that at the time was worth slightly more than $30 per share, but declines in Konecranes' share price had made the value to Terex shareholders less than the original bid. The question Terex shareholders have to answer now is whether a cash deal is better than the controlling interest in Konecranes that they would have after an all-stock merger with the Finnish company. The stock still has nearly $10 per share of upside even after today's jump, so it's unclear what exactly Terex will do to respond to the offer.

Finally, Weight Watchers stock climbed nearly 20% after investor and board member Oprah Winfrey announced that she had used the program to lose a substantial amount of weight. Essentially, Oprah's use of social media has been sufficient to drive hype in the weight-loss provider's stock, and many investors are still holding out hope that Winfrey will eventually make an offer to buy the entire company at a premium to its current share price. Whether Oprah's results will drive more business to Weight Watchers remains to be seen, but the stock remains at just half the level it traded last autumn, when full takeover rumors were at their loudest. Investors can expect more volatility until the question of the company's future independence is resolved once and for all.

Dan Caplinger has no position in any stocks mentioned. The Motley Fool owns shares of and recommends SolarCity. The Motley Fool recommends Terex. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Stocks Mentioned

WW International, Inc. Stock Quote
WW International, Inc.
$6.18 (-15.80%) $-1.16
SolarCity Corporation Stock Quote
SolarCity Corporation
Terex Corporation Stock Quote
Terex Corporation
$34.11 (-1.13%) $0.39

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