Please ensure Javascript is enabled for purposes of website accessibility

Why Lumber Liquidators, SolarCity, and Intercept Pharmaceuticals Jumped Today

By Dan Caplinger - Apr 5, 2016 at 5:51PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Even though the market fell again, these stocks produced solid gains. Find out why.


Image source: SolarCity.

Concerns about the global economy plagued the U.S. stock market on Tuesday, and investors sent major market benchmarks to their second straight day of losses this week. The S&P 500 fell 1%, while the Dow settled for a 0.75% decline, following international stock markets lower.

U.S. investors have largely been sheltered from the global slowdown, but with earnings season set to start officially next week, companies could continue to see the impact of sluggish economic conditions in key parts of the globe. That could weigh on results, and investors reacted to that prospect negatively. Still, some stocks managed to climb despite the negative sentiment, and Lumber Liquidators (LL 2.75%), SolarCity (SCTY.DL), and Intercept Pharmaceuticals (ICPT 6.72%) were among the better performers on the day.

Lumber Liquidators jumped 11% after the flooring specialist said it had won a California lawsuit. The suit, filed under the state's Proposition 65 covering cancer-causing chemicals, had alleged that the retailer hadn't made consumers aware of formaldehyde in some of its laminate flooring. A court dismissed the suit, and Lumber Liquidators said the favorable ruling marked an important step forward for the company. In the words of the flooring company's statement, "We look forward to continuing to deliver products that are compliant with California's environmental standards." The stock is still far below where it traded before the controversy over its flooring began, but Lumber Liquidators hopes the resolution of the lawsuit will put the episode behind it and allow the company to start making forward progress again.

SolarCity rose 7%. The solar-system provider had a minor news item about a two-megawatt solar array in a remote portion of West Texas, but the more likely cause of the bump had to do with the negative comments that solar peer First Solar made in its analyst-day presentation. First Solar said it wouldn't make projections about its expected financial results for 2017, saying instead that it didn't have enough certainty about its future direction to provide solid guidance. Investors in First Solar took that as bad news, but SolarCity seemed to take bad news for its competitor as good news for its own prospects. The residential solar specialist still faces plenty of uphill battles against regulators and others in the industry, but many think SolarCity can still keep taking advantage of favorable tax incentives to entice homeowners to install residential systems and keep the money flowing.

Finally, Intercept Pharmaceuticals climbed 13% in the wake of favorable comments from an FDA staff review for its obeticholic acid for treating a liver disease known as primary biliary cirrhosis. The reviewers supported the use of obeticholic acid under certain circumstances, although it stopped short of making a general assessment of the drug's safety record, especially in patients that suffered from the disease more seriously. The next step for Intercept will be a formal advisory panel meeting later this week, and if that goes well, the road to final FDA approval will be much clearer for the drug and for Intercept's long-term prospects.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Lumber Liquidators Holdings, Inc. Stock Quote
Lumber Liquidators Holdings, Inc.
LL
$12.35 (2.75%) $0.33
SolarCity Corporation Stock Quote
SolarCity Corporation
SCTY.DL
Intercept Pharmaceuticals Stock Quote
Intercept Pharmaceuticals
ICPT
$18.57 (6.72%) $1.17

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

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
356%
 
S&P 500 Returns
124%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/28/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.