Stocks finished higher on Wednesday, but Wall Street had to fight a little harder to keep the positive streak going amid some new concerns about the omicron COVID-19 variant. For parts of the day, the Dow Jones Industrial Average (^DJI 0.56%), S&P 500 (^GSPC 0.11%), and Nasdaq Composite (^IXIC +0.35%) all traded lower, but by the end of the day, they were all able to post at least modest gains.
|
Index |
Daily Percentage Change |
Daily Point Change |
|---|---|---|
|
Dow |
+0.10% |
+35 |
|
S&P 500 |
+0.31% |
+14 |
|
Nasdaq |
+0.64% |
+100 |
Data source: Yahoo! Finance.
Many investors were looking forward to the close of trading, with popular video game retailer GameStop (GME +1.53%) set to report its latest earnings. The numbers from GameStop disappointed shareholders, causing shares to fall after hours. However, another stock that hasn't gotten nearly as much attention from average investors is set to become more of a household name in the near future. Below, we'll reveal that name, but first, let's look at what GameStop announced.
GameStop under pressure
Shares of GameStop were down between 4% and 5% as of 4:15 p.m. ET, just 15 minutes after the video game retailer released its third-quarter financial results. The company managed to generate considerable growth, but there's apparently still some uncertainty among investors about whether it'll be enough to mount a sustainable turnaround effort.
Image source: Getty Images.
GameStop's numbers were mixed. Revenue came in just short of $1.3 billion, up almost 30% from year-ago levels. The video game specialist pointed to brand relationships with industry giants like Samsung, LG, Razer, and Vizio as key contributors to overall top-line growth during the quarter. GameStop also reported ample liquidity, with cash and equivalents topping $1.4 billion against less than $50 million in debt.
GameStop is continuing to pitch itself as a technology innovator, opening offices in Seattle and Boston to tap into valuable talent pools. However, losses ballooned above $105 million, more than five times greater than in the year-ago period.
Few investors expect GameStop to turn a profit anytime soon. Eventually, though, that'll be the key to judging whether its turnaround attempt has been a success. With the stock having soared in 2021, shareholders expect nothing but unqualified victory from GameStop in the long run.
An S&P invitation for a rising tech star
Seeing much better performance was EPAM Systems (EPAM 1.11%). The provider of IT services has flown under the radar for years, but it's about to be a lot more familiar to index fund investors everywhere.
EPAM's stock soared 18% in the regular trading session on Wednesday after the company got an invitation to join the S&P 500 index. The tech company is set to take the place of Kansas City Southern (KCS +0.00%), which fellow railroad Canadian Pacific (CP 0.63%) is looking to acquire. With most of the necessary approvals for the merger in place, S&P Dow Jones Indices felt comfortable making the move, which will become effective as of the market open on Tuesday, Dec. 14.
EPAM has quietly risen from modest roots to reach the pinnacle of large-cap status. The company has been instrumental in helping clients mount digital transformation efforts, with access to high-quality IT workers in Eastern Europe helping to boost productivity levels while keeping overall costs lower than they'd be in other parts of the world.
Joining the S&P 500 has historically resulted in quick one-day gains like this, but it also improves EPAM's access to capital going forward. It'll be interesting to see how EPAM uses this latest news to its long-term advantage in the years ahead.
