What Happened?
A number of stocks fell in the afternoon session after stocks gave back some of the gains from the previous day as the White House clarified the tariffs on imports from China would add up to 145%, while the baseline 10% tariffs remained in place for most countries. This reminded markets that the global trade environment remained volatile, limiting the potential for sustained gains.
Also, President Trump indicated he was willing to accept pain in the short term, and was aware his policies could cause a recession, but he remained more mindful of a more severe case of economic depression (higher unemployment and prolonged downturn). For investors, this suggested that the administration could prioritize long-term structural shifts over near-term economic stability, further increasing policy-driven risk in the markets.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, following stocks were impacted:
- Maintenance and Repair Distributors company DXP (NASDAQ:DXPE) fell 5.8%. Is now the time to buy DXP? Access our full analysis report here, it’s free.
- Electrical Systems company Kimball Electronics (NASDAQ:KE) fell 5.1%. Is now the time to buy Kimball Electronics? Access our full analysis report here, it’s free.
- Air Freight and Logistics company United Parcel Service (NYSE:UPS) fell 5.4%. Is now the time to buy United Parcel Service? Access our full analysis report here, it’s free.
- Electronic Components company Corning (NYSE:GLW) fell 5.6%. Is now the time to buy Corning? Access our full analysis report here, it’s free.
- Home Builders company Taylor Morrison Home (NYSE:TMHC) fell 5.4%. Is now the time to buy Taylor Morrison Home? Access our full analysis report here, it’s free.
Zooming In On DXP (DXPE)
DXP’s shares are very volatile and have had 21 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 biggest move we wrote about over the last year was 5 months ago when the stock gained 21.5% on the news that the company reported strong third-quarter earnings. DXP blew past analysts' sales, EPS, and EBITDA estimates as its acquisition-driven strategy continued to pay off. Notably, the company closed five acquisitions through the third quarter and already added two more for the next quarter. Zooming out, we think this was a good quarter with some key areas of upside.
DXP is down 7.2% since the beginning of the year, and at $78.31 per share, it is trading 26.8% below its 52-week high of $107.03 from January 2025. Investors who bought $1,000 worth of DXP’s shares 5 years ago would now be looking at an investment worth $5,638.
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