Stocks fell in the morning on Monday but reversed course to close with mixed results. The Dow Jones Industrial Average (DJINDICES: ^DJI) dropped over 200 points but ultimately ended the session higher, and the S&P 500 (SNPINDEX: ^GSPC) had a small loss.
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The results of the election in Brazil lifted emerging market stocks, especially the iShares MSCI Brazil ETF (NYSEMKT: EWZ), which rose 6.7%. Technology stocks were laggards; the Vanguard Information Technology ETF (NYSEMKT: VGT) fell 1.3%.
As for individual stocks, General Electric (NYSE: GE) landed an analyst upgrade and announced another asset sale, and New Age Beverages (NASDAQ: NBEV) revealed more plans for its marijuana-based drinks.
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GE rises on upgrade, asset sale
Shares of General Electric gained 3.3% to $13.61 after an analyst upgraded the stock and the company announced a sale of $1 billion in equity investments to Apollo Global Management, LLC (NYSE: APO). Barclays upgraded GE's rating to overweight and reiterated its $16 price target.
General Electric is selling Apollo a portfolio of mostly equity investments in energy assets from GE Capital's Energy Financial Services unit as part of a program to reduce the assets of GE Capital by $25 billion by the end of 2019. The portfolio consists of about 20 investments in renewable energy, contracted natural gas fired generation, and midstream energy infrastructure assets. The two companies also said they will form on ongoing relationship for future investments in energy infrastructure. Apollo is one of the world's largest hedge fund managers, and has recently been mentioned in regard to asset purchases from Arconic, RPG Group, and GameStop.
The upgrade comes the week after GE announced an unexpected CEO change, with outsider Lawrence Culp being brought in and given an employment contract heavily laden with incentives to get the stock price back up. The research note from Barclays analyst Julian Mitchell suggests the stock is significantly undervalued, and under his "Blue Sky" outcome, it could stage a recovery with upside to over $20.
Investors get impatient with expected debut of cannabis drinks
New Age Beverage stock soared last month after investors learned that the company plans to sell a line of drinks infused with cannabidiol (CBD), but shares came down 12.8% after details of the launch were released late Friday and today. The Colorado-based maker of organic and natural drinks presented its plans for drinks based on the non-psychoactive derivative of marijuana at a conference sponsored by B. Riley FBR on Friday and was expected to unveil the products today at the North American Convenience Store (NACS) show in Las Vegas.
In a press release on Sept. 19, New Age said it had been testing the CBD-infused drink in Colorado earlier in the year, and, based on customer acceptance of it, had decided to expand distribution to other states where it was legal. It said that it had interest from major retailers in North America and will be using the NACS show to meet with select retail partners to unveil its product portfolio, "taking orders on a first come, first serve basis, given anticipated demand." The release set up a feeding frenzy among investors chasing the marijuana stock trend, with shares up 433% since the week before the announcement.
At the B. Riley FBR conference, though, company officials said that a large-scale launch won't happen until March or April. That timetable may have proved a bit disappointing to New Age investors expecting to quickly profit from the company's entry into what it says will be a $22 billion market for CBD products.
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Jim Crumly has no position in any of the stocks mentioned. The Motley Fool owns shares of GME and has the following options: short January 2019 $16 calls on GME. The Motley Fool has a disclosure policy.