Market participants appeared to play a waiting game on Monday, with major benchmarks making small moves to begin the week. Investors hope that the G-20 summit in Japan that starts this Friday will answer some long-held questions about whether the U.S. can improve its trade relations with key partners like China, and the event could also help central banks around the world unify their strategy with respect to supporting the global economy. Even though the overall market was stuck in early summer doldrums, some stocks had big moves to the upside. NRC Group Holdings (NYSEMKT: NRCG), PCM (NASDAQ: PCMI), and Krystal Biotech (NASDAQ: KRYS) were among the top performers. Here's why they did so well.
NRC Group isn't wasting this opportunity
Shares of NRC Group Holdings jumped 23% after the waste management company received a buyout bid from an industry peer. US Ecology (NASDAQ: ECOL) offered to give NRC Group investors 0.196 shares of US Ecology for every NRC share they own, working out to an implied price of roughly $12 per share based on recent trading of US Ecology's stock. The move should help the combined company offer a more comprehensive set of services to its customers, and in particular, NRC's status as one of two oil spill removal specialists will give the post-merger US Ecology valuable business in key energy areas like the Permian Basin, the Eagle Ford shale play, and the Gulf of Mexico. Meanwhile, the premium price will have NRC Group investors happy whether they choose to stick with US Ecology or sell their shares.
Image source: NRC Group.
PCM gets a bid of its own
PCM's stock soared 43% following the company's announcement that Insight Enterprises (NASDAQ: NSIT) will acquire the provider of tech products and services. Under the agreement, Insight will pay $35 per share to PCM investors, putting an enterprise value of $581 million on the acquisition target. Insight believes that buying PCM will help it build market share in key areas that include supply-chain optimization, the connected work force, cloud computing and data center adoption, and digital innovation. The acquirer also believes that buying PCM will boost its earnings by 2020. Given the cutthroat competition in key IT growth areas, it's not surprising to find small companies banding together to fight off larger rivals.
Krystal wins a faster review
Finally, shares of Krystal Biotech skyrocketed 41%. The gene therapy company released data from its phase 2 study of its KB103 treatment for rare dermatological diseases, and the results were favorable, with positive findings on endpoints including percentage of patients seeing their wounds close properly, the time to 100% wound closure, and the length of time the wound remained closed. Krystal also reported that the U.S. Food and Drug Administration has granted KB103 its designation as a regenerative medicine advanced therapy, which will give it an opportunity to gain expedited review. Krystal isn't the first company to win RMAT status, but shareholders are happy that the biotech will have a chance to move quickly toward what they hope will be a positive outcome.
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