What Happened?

A number of stocks jumped in the afternoon session after the U.S. Supreme Court struck down tariffs imposed by the Trump administration, a move expected to lower costs for manufacturers. 

In a 6-3 decision, the court ruled that the administration's use of the International Emergency Economic Powers Act of 1977 to justify the tariffs was not applicable. The removal of these tariffs is expected to reduce the cost of imported parts, materials, and equipment, which are crucial inputs for many U.S.-based manufacturing companies. Economists suggest this will alleviate budget pressures on these firms and could also reduce broader inflation concerns, potentially paving the way for accelerated interest rate cuts by the central bank. The ruling is seen as particularly beneficial for small and medium-sized businesses, which have shouldered much of the financial burden from the import duties.

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:

• Construction and Maintenance Services company WillScot Mobile Mini (NASDAQ: WSC) jumped 5%. Is now the time to buy WillScot Mobile Mini? Access our full analysis report here, it’s free.
• Engineering and Design Services company Sterling (NASDAQ: STRL) jumped 4.3%. Is now the time to buy Sterling? Access our full analysis report here, it’s free.
• Specialty Equipment Distributors company Herc (NYSE: HRI) jumped 6.1%. Is now the time to buy Herc? Access our full analysis report here, it’s free.
• General Industrial Machinery company Kadant (NYSE: KAI) jumped 5.5%. Is now the time to buy Kadant? Access our full analysis report here, it’s free.
• Home Builders company LGI Homes (NASDAQ: LGIH) jumped 3.7%. Is now the time to buy LGI Homes? Access our full analysis report here, it’s free.

Zooming In On Herc (HRI)

Herc’s shares are extremely volatile and have had 41 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 3 days ago when the stock dropped 12.1% on the news that the company reported mixed fourth-quarter 2025 results and issued a disappointing outlook for 2026. 

While the company's adjusted earnings of $2.07 per share surpassed analysts' expectations, its revenue of $1.21 billion fell short of forecasts. The bigger concern for investors, however, was the company's financial guidance for the upcoming year. Herc's full-year 2026 revenue forecast came in significantly below Wall Street estimates, suggesting slower growth ahead. Furthermore, its adjusted earnings per share of $2.07 represented a 42% decline compared to the same quarter in the previous year. This combination of a revenue miss, a steep drop in profitability, and a weak future outlook prompted a negative reaction from the market.

Herc is flat since the beginning of the year, and at $153.31 per share, it is trading 15.4% below its 52-week high of $181.12 from February 2026. Investors who bought $1,000 worth of Herc’s shares 5 years ago would now be looking at an investment worth $1,884.

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