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Why Calavo Growers, Thor Industries, and Omeros Jumped Today

By Dan Caplinger – Mar 8, 2016 at 7:45PM

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Even on a bad day for Wall Street, these stocks climbed. Find out why.


Image: Calavo Growers.

Tuesday ended the stock market's five-day winning streak, and several major market benchmarks fell more than 1% on the day. Chinese trade numbers weren't as vigorous as many had hoped, and the corresponding impact on the commodities markets led to reversals in the energy and materials sector for many stocks. Yet as hard as the decline hit some stocks, others managed to buck the downtrend and post substantial increases. Among them were Calavo Growers (CVGW -0.07%), Thor Industries (THO -1.14%), and Omeros (OMER -1.80%).

Calavo Growers jumped 11% after the avocado grower posted record results in its fiscal first quarter. Revenue climbed 5% to $204.6 million, and that led to net income increases of nearly 20% from year-ago figures. Gross margin increases in its business helped support the company's profitability, and the fact that Calavo managed to boost its take even as avocado prices fell compared to year-ago levels was particularly impressive and pointed to the success of its sourcing and production-management efforts. Calavo expects 2016 to be a record-setting year for the company, and industry projections expect consumption of 2.5 billion pounds of avocados this year. With new packing capacity coming on line and expansion in international markets, Calavo is excited about its future.

Thor Industries gained 6% on favorable earnings news of its own. The maker of recreational vehicles reported an increase of 14% in revenue from continuing operations, and a 55% gain in net income showed the strength of the RV market in light of low gasoline prices. Motorized RVs showed much greater gains than Thor's towable RV segment, but an overall rise in dealer inventory pointed to optimism about the prospects for even greater RV sales once the high season hits. Even though the company expects some favorable factors like falling material costs to flatten out later in 2016, Thor Industries still believes that a healthy RV market will lead to long-term success for the company.

Finally, Omeros climbed 16%. The maker of cataract therapy Omidria said that it would begin a late-stage Phase 3 trial of its OMS721 treatment for a rare condition known as atypical hemolytic uremic syndrome. If the trial proves successful, then the treatment will have the potential to replace a competing blockbuster drug that features a multi-billion dollar revenue haul annually. Because OMS721 has orphan drug status and is also eligible for fast-track consideration, investors are excited that the upward potential for Omeros is greater than ever. There are still hurdles that Omeros must overcome before it can claim final victory, but for now, investors are willing to buy into the positive story from the company and hope for strong results from its new phase 3 study.

Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends Thor Industries. 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.

Stocks Mentioned

Calavo Growers Stock Quote
Calavo Growers
CVGW
$34.08 (-0.07%) $0.03
Thor Industries Stock Quote
Thor Industries
THO
$79.04 (-1.14%) $0.91
Omeros Stock Quote
Omeros
OMER
$2.18 (-1.80%) $0.04

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

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