What Happened?
A number of stocks jumped in the afternoon session after investors continued to pile into value-oriented names amid growing valuation concerns. This shift reflects growing caution over high valuations within the technology and artificial intelligence (AI) spheres. As market participants reassessed risk, they reallocated capital from growth-heavy indices, like the Nasdaq, to companies in areas like industrials and financials, which were perceived to be more reasonably priced. Contributing to the positive momentum, markets remained hopeful that a prolonged 40-day government shutdown would be over. The U.S. Senate approved a compromise funding package, which was pending a vote in the House. The potential end to the shutdown brought a sense of relief to markets.
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:
- Specialized Technology company Mirion (NYSE: MIR) jumped 1.9%. Is now the time to buy Mirion? Access our full analysis report here, it’s free for active Edge members.
- Hardware & Infrastructure company Dell (NYSE: DELL) jumped 2.2%. Is now the time to buy Dell? Access our full analysis report here, it’s free for active Edge members.
- Satellite Telecommunication Services company Globalstar (NASDAQ: GSAT) jumped 8.3%. Is now the time to buy Globalstar? Access our full analysis report here, it’s free for active Edge members.
- Electronic Components & Manufacturing company Flex (NASDAQ: FLEX) jumped 2.5%. Is now the time to buy Flex? Access our full analysis report here, it’s free for active Edge members.
- IT Distribution & Solutions company CDW (NASDAQ: CDW) jumped 3.4%. Is now the time to buy CDW? Access our full analysis report here, it’s free for active Edge members.
Zooming In On Globalstar (GSAT)
Globalstar’s shares are extremely volatile and have had 44 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 2 days ago when the stock gained 16.8% on the news that the stock's positive momentum continued as the company reported record third-quarter revenue that surpassed estimates and its partner, Apple, revealed plans to enhance iPhone satellite features. The satellite communications firm posted record revenue of $73.8 million for the third quarter, which led B. Riley to raise its price target on the stock. Adding to the positive news, Apple, a key partner, announced plans to expand its satellite capabilities using Globalstar's network. These new features included satellite-enhanced navigation within Apple Maps and the ability to send photos through iMessage without a cellular signal. Furthermore, Globalstar announced a major expansion of its ground infrastructure in Brazil, installing eight new antennas as part of a global upgrade. This series of positive developments boosted investor confidence, sending the stock to a new 52-week high.
Globalstar is up 104% since the beginning of the year, and at $64.90 per share, has set a new 52-week high. Investors who bought $1,000 worth of Globalstar’s shares 5 years ago would now be looking at an investment worth $13,020.
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