What Happened?
Shares of digital operations platform PagerDuty (NYSE: PD) fell 3.3% in the morning session after a broader market downturn impacted the technology sector, as investors grew cautious ahead of a key speech by Federal Reserve Chair Jerome Powell. The move came as U.S. equity markets recorded a fifth consecutive day of losses for major indexes like the S&P 500, with technology stocks experiencing the largest declines. Investors have grown wary that the sharp rally in the tech sector since April may have advanced too far. The market-wide caution is largely driven by the upcoming Jackson Hole symposium, a meeting of central bankers, where traders are anxiously awaiting Fed Chair Powell's speech on Friday for guidance on the future path of interest rates.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy PagerDuty? Access our full analysis report here, it’s free.
What Is The Market Telling Us
PagerDuty’s shares are somewhat volatile and have had 14 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 7 days ago when the stock dropped 3.3% on the news that a hotter-than-expected wholesale inflation report revived concerns about persistent inflation and tempered hopes for a Federal Reserve interest rate cut. The Producer Price Index (PPI) for July jumped 3.3% from a year earlier, surprising economists who had forecasted a 2.5% rate. This data revived concerns about persistent inflation and forced traders to reconsider the likelihood of a near-term interest rate cut by the Federal Reserve. High-growth technology stocks, which dominate the SaaS landscape, are particularly sensitive to interest rate fluctuations.
PagerDuty is down 11.9% since the beginning of the year, and at $15.85 per share, it is trading 26.8% below its 52-week high of $21.65 from December 2024. Investors who bought $1,000 worth of PagerDuty’s shares 5 years ago would now be looking at an investment worth $545.80.
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