Here's Why Adobe Stock Rose Almost 10 Percent Today
Today's takeaways from the Entrepreneur Index™ include a Tesla rebound.
What goes down must come up -- at least in a bull market.
Investors shrugged of geopolitical concerns and fears of rising interest rates to get the stock market back on track. 58 of 60 stocks on the Entrepreneur Index™ were up on the day and 19 posted gains of 3 percent or more. The index was up 2.69 percent.
Profits and the excitement about profits to come appeared to fuel the optimism. Over 800 sell-side analysts polled by FactSet are expecting the earnings of S&P 500 companies to grow by 19 percent in the third quarter. Already, investment banks, drug companies and insurers have beaten estimates and helped the market recover some of the losses it suffered last week.
Adobe Systems Inc. registered the biggest gain of the day, rising 9.52 percent. The jump was not because of actual earnings reported but because of guidance on the outlook for next year. At a meeting with analysts yesterday, the software maker affirmed guidance on this year's financials but projected a 20 percent jump in revenue next year. After falling nearly 15 percent since the beginning of the month, Adobe's shares are up 49 percent so far this year.
The rest of the tech stocks on the Entrepreneur Index™ also rose sharply. Notable gains included TripAdvisor Inc.(5.91 percent), NVIDIA (4.44 percent), Twitter (4.4 percent), Netflix (3.98 percent), salesforce.com (3.87 percent), and Facebook (3.43 percent).
Discount retailer Dollar Tree Inc. posted the second biggest gain on the day. It was up 6.83 percent after the New York Post newspaper reported that activist shareholder Carl Icahn had taken a stake in the company.
Investors also sent Walmart shares up, despite the company's cut in its profit forecast for next year. The company blamed the drag from its recent $16 billion acquisition of Indian online retailer FlipKart. The former brick-and-mortar retailer is now battling with Amazon for online market share across the globe. Walmart made the announcement yesterday at its annual shareholder meeting in Bentonville, Arkansas. Shares were down in pre-market trading but recovered and ended the day up 2.12 percent.
Tesla posted one of the biggest gains of the day after a judge affirmed the settlement between the company and the Securities and Exchange Commission over tweets CEO Elon Musk made in August. Since Musk tweeted that he was on the verge of taking the company private, Tesla shares had fallen by more than 30 percent. They were up 6.55 percent today. The settlement includes $20 million fines on both Musk and Tesla, and it required that Musk step down as chairman of the company's board for three years.
It was not all smiles and giggles on the earnings front today. Shares of asset manager BlackRock fell 4.4 percent -- the biggest decline on the Entrepreneur Index™ -- after it reported disappointing top line growth for the third quarter. Earnings per share beat estimates thanks to lower taxes and higher non-operating income, but revenues grew by just 2 percent. The industry leader also experienced net outflows of $3.1 billion in investor assets during the quarter. The only other company on the index that fell today was Ford Motor Co. (-0.11 percent)
All eyes are now on Netflix. The company will announce third quarter earnings after the market closes. Subscriber growth numbers disappointed Wall Street last quarter, and many believe the company's third quarter financials could buoy or sink investor sentiment on the technology sector.
The Entrepreneur Index™ collects the top 60 publicly traded companies founded and run by entrepreneurs. The entrepreneurial spirit is a valuable asset for any business, and this index recognizes its importance, no matter how much a company has grown. These inspirational businesses can be tracked in real time on Entrepreneur.com.