What Happened?
Shares of work management platform monday.com (NASDAQ: MNDY) jumped 6.2% in the afternoon session after investment firm DA Davidson reiterated its Buy rating on the stock while maintaining its $275 price target.
The firm's renewed confidence followed its attendance at monday.com's Elevate user conference in New York City, where it noted positive long-term growth prospects. The price target represented significant potential upside from the stock's price at the time.
The shares closed the day at $219.31, up 6.3% from previous close.
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What Is The Market Telling Us
monday.com’s shares are very volatile and have had 28 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 1 day ago when the stock gained 8.2% on the news that investors scooped up equities, shaking off the initial concerns inferred from the Fed's dot plot, with tech stocks leading the charge.
As a reminder, the Federal Reserve cut its benchmark interest rate by 25 basis points yesterday and signaled that more reductions could come before year-end and beyond. Initially when the cut was announced and Fed Chair Powell held his press conference, there was a pullback in the market as the Fed's "dot plot" revealed that only one cut was likely for 2026. This was below the three cuts that had been priced into the markets. This was the first interest rate cut of 2025, a move investors had widely anticipated. In response to the decision, stocks rose significantly, positioning major indexes like the S&P 500 and Nasdaq to open at record levels.
The Fed's decision was influenced by signs of a weakening labor market. Lower interest rates are generally seen as positive for stocks because they reduce borrowing costs for businesses and make fixed-income investments like bonds less attractive by comparison, driving capital into the equity market. While Fed Chair Powell noted the path forward has risks, the prospect of looser monetary policy has fueled optimism on Wall Street.
monday.com is down 5.1% since the beginning of the year, and at $219.15 per share, it is trading 33.2% below its 52-week high of $327.92 from February 2025. Investors who bought $1,000 worth of monday.com’s shares at the IPO in June 2021 would now be looking at an investment worth $1,225.
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