What Happened?
A number of stocks jumped in the afternoon session after the major indices rebounded (Nasdaq +2.0%, S&P 500 +1.5%) as President Trump postponed the planned 50% tariff on European Union imports, shifting the start date to July 9, 2025.
Companies with substantial business ties to Europe likely had some relief as the delay reduced near-term cost pressures and preserved cross-border demand.
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:
- Medical Devices & Supplies - Specialty company Bausch + Lomb (NYSE: BLCO) jumped 5.8%. Is now the time to buy Bausch + Lomb? Access our full analysis report here, it’s free.
- Branded Pharmaceuticals company Organon (NYSE: OGN) jumped 5.8%. Is now the time to buy Organon? Access our full analysis report here, it’s free.
- Satellite Telecommunication Services company Globalstar (NASDAQ: GSAT) jumped 5.7%. Is now the time to buy Globalstar? Access our full analysis report here, it’s free.
- Terrestrial Telecommunication Services company Telephone and Data Systems (NYSE: TDS) jumped 5.2%. Is now the time to buy Telephone and Data Systems? Access our full analysis report here, it’s free.
- Electronic Components company nLIGHT (NASDAQ: LASR) jumped 6.1%. Is now the time to buy nLIGHT? Access our full analysis report here, it’s free.
Zooming In On nLIGHT (LASR)
nLIGHT’s shares are extremely volatile and have had 33 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 4 months ago when the stock dropped 17.1% on the news that the company reported underwhelming preliminary fourth quarter results, with sales expected to fall below the previous guidance range. Precisely, LASR expects Q4 2024 revenues of $46 million to $48 million (vs. previous estimates of $49 million to $54 million).
The company blamed the weakness on "continued weakness in our industrial markets, execution challenges in our microfabrication business, and the timing of the delivery of a limited number of defense products."
Consequently, profit indicators, including gross margin and adjusted EBITDA, are also expected to fall significantly below previous estimates. Overall, the results aren't encouraging and indicate challenging times ahead.
nLIGHT is up 48% since the beginning of the year, and at $15.38 per share, has set a new 52-week high. Investors who bought $1,000 worth of nLIGHT’s shares 5 years ago would now be looking at an investment worth $734.61.
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