What Happened?

A number of stocks jumped in the afternoon session after the latest Personal Consumption Expenditures (PCE) Price Index report aligned with economists' predictions, signaling that inflation is under control. 

The Core PCE Price Index, which is closely watched by the Federal Reserve as it excludes volatile food and energy costs, rose 0.2% month-over-month and 2.9% year-over-year. These figures precisely matched Wall Street estimates. This alignment provides relief for investors and reinforces the market's belief that inflationary pressures are being managed without harming economic growth. The positive market reaction highlights a growing conviction that the Federal Reserve will likely proceed with its anticipated path of interest rate cuts, which would make capital cheaper and help stimulate further economic expansion.

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:

• Professional Staffing & HR Solutions company Alight (NYSE: ALIT) jumped 3.4%. Is now the time to buy Alight? Access our full analysis report here, it’s free.
• Satellite Telecommunication Services company Iridium (NASDAQ: IRDM) jumped 4.6%. Is now the time to buy Iridium? Access our full analysis report here, it’s free.
• IT Distribution & Solutions company CDW (NASDAQ: CDW) jumped 4.2%. Is now the time to buy CDW? Access our full analysis report here, it’s free.
• Professional Staffing & HR Solutions company First Advantage (NASDAQ: FA) jumped 3%. Is now the time to buy First Advantage? Access our full analysis report here, it’s free.
• Hardware & Infrastructure company Xerox (NASDAQ: XRX) jumped 3.3%. Is now the time to buy Xerox? Access our full analysis report here, it’s free.

Zooming In On Iridium (IRDM)

Iridium’s shares are quite volatile and have had 18 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 14 days ago when the stock dropped 3.3% on the news that Raymond James downgraded the stock to "Outperform" from "Strong Buy" and significantly lowered its price target. 

The price target was adjusted to $26, down from the previous $39. The downgrade follows a strategic move by rival SpaceX Starlink, which announced the purchase of spectrum rights to intensify its push into the Direct-to-Device market. This acquisition has heightened competitive concerns within the satellite communications sector, pressuring Iridium's stock, which had already fallen approximately 29% this week. The analyst action reflects growing uncertainty about Iridium's position in an increasingly competitive landscape.

Iridium is down 40.1% since the beginning of the year, and at $17.68 per share, it is trading 47.3% below its 52-week high of $33.57 from October 2024. Investors who bought $1,000 worth of Iridium’s shares 5 years ago would now be looking at an investment worth $702.10.

Do you want to know what moves the business you care about? Add them to your StockStory watchlist and every time a stock significantly moves, we provide you with a timely explanation straight to your inbox. It’s free and will only take you a second.