What Happened?
Shares of visual content marketplace Getty Images (NYSE: GETY) fell 7.5% in the morning session after the UK's competition regulator announced its intent to refer the company's proposed merger with Shutterstock for an in-depth Phase 2 review. The Competition and Markets Authority (CMA) raised concerns that the deal could harm competition in the supply of stock and editorial images. The regulator noted that Getty Images was the “clear market leader” and Shutterstock was “one of the few material alternatives.” This deeper investigation introduces significant uncertainty and a potential roadblock for the merger's completion. The two companies were given a deadline to offer acceptable solutions to address the regulator's concerns to avoid the more intensive probe. Despite the setback, Getty Images stated it remained committed to the merger and would continue to work with the authorities to secure the necessary approvals.
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What Is The Market Telling Us
Getty Images’s shares are extremely volatile and have had 52 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 10 days ago when the stock dropped 4.3% on the news that President Donald Trump threatened to significantly increase tariffs on Chinese imports, reigniting trade war fears. The threat immediately broke a monthslong calm on Wall Street, sending the S&P 500 down 1.2% in its worst session since August. For the industrial sector, which is heavily reliant on global supply chains, the prospect of new tariffs is particularly concerning. Aggressive U.S. trade policies lead to unpredictable input costs and disrupt manufacturing operations. This volatility weighs heavily on companies that depend on a stable international trade for both sourcing materials and selling finished goods, leading to a broad sell-off among industrial giants.
Getty Images is down 6.4% since the beginning of the year, and at $1.97 per share, it is trading 55.2% below its 52-week high of $4.41 from November 2024. Investors who bought $1,000 worth of Getty Images’s shares 5 years ago would now be looking at an investment worth $198.99.
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