What Happened?
A number of stocks jumped in the afternoon session after the major indices rebounded, as Fed Chair Jerome Powell delivered dovish remarks at the much-awaited Jackson Hole symposium. Powell suggested that with inflation risks moderating and unemployment remaining low, the Federal Reserve might consider a shift in its monetary policy stance, including potential interest rate cuts. This outlook eased market concerns about prolonged high interest rates and their impact on economic growth. The prospect of lower borrowing costs bolstered investor confidence, particularly in sectors that have lagged, leading to a broad rally across the market.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Thrifts & Mortgage Finance company PennyMac Mortgage Investment Trust (NYSE: PMT) jumped 3.4%. Is now the time to buy PennyMac Mortgage Investment Trust? Access our full analysis report here, it’s free.
- Perishable Food company Dole (NYSE: DOLE) jumped 3.2%. Is now the time to buy Dole? Access our full analysis report here, it’s free.
- Real Estate Services company CBRE (NYSE: CBRE) jumped 3.1%. Is now the time to buy CBRE? Access our full analysis report here, it’s free.
- Professional Tools and Equipment company Snap-on (NYSE: SNA) jumped 3.5%. Is now the time to buy Snap-on? Access our full analysis report here, it’s free.
- Defense Contractors company Kratos (NASDAQ: KTOS) jumped 3.2%. Is now the time to buy Kratos? Access our full analysis report here, it’s free.
Zooming In On Snap-on (SNA)
Snap-on’s shares are not very volatile and have only had 5 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 4 months ago when the stock dropped 8.6% on the news that the company reported weak first-quarter 2025 results: Its revenue missed significantly, and its EPS fell short of Wall Street's estimates. The big story was a 3.5% drop in sales, with most of that coming from weaker demand in the U.S. Tools Group. Overall, this quarter could have been better.
Snap-on is down 1% since the beginning of the year, and at $331.66 per share, it is trading 10.7% below its 52-week high of $371.35 from November 2024. Investors who bought $1,000 worth of Snap-on’s shares 5 years ago would now be looking at an investment worth $2,222.
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