Why Are These Stocks Surging Today?

Shares of Avon Products, Inc. (NYSE:AVP) have surged by 7% after the company announced that it has formed a $605 million Strategic Partnership with Cerberus Capital Management. Under the terms of the partnership, Cerberus will invest $435 million in Avon Products in the form of convertible perpetual preferred stock with a conversion price of $5 per share and in exchange for a dividend that accrues at a rate of 5% per year. In addition, Avon Products will spin off Avon North America and Cerberus will purchase 80.1% of the spun-off unit for $170 million. Avon Products, Inc. (NYSE:AVP) also announced that it will suspend its dividend effective the first quarter of 2016 as part of its strategic restructuring. Shares of the company are off more than 50% year-to-date, but have rallied strongly from their mid-November lows.

Wrapping up our list of gainers today is Weibo Corp (ADR) (NASDAQ:WB), whose shares are up nearly 3% in morning trading after the analysts at Morgan Stanley upgraded the stock to ‘Overweight’ from ‘Equal Weight’. Weibo Corp (ADR) (NASDAQ:WB) benefits from rising internet penetration in China, as well as an increasingly affluent Chinese middle class. Many investors have also speculated that the ‘Chinese Twitter’ could be a takeover target for sprawling internet conglomerates such as Alibaba Group Holding Ltd (NYSE:BABA). If the Chinese economy recovers, look for Weibo to do well.

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