What Happened?

A number of stocks fell in the afternoon session after concerns about the health of the U.S. economy grew following a significant downward revision of job market data. 

The Labor Department reported that employers added 911,000 fewer jobs from April 2024 through March than initially estimated. These "benchmark revisions" are issued annually to more accurately account for new and defunct businesses. The report detailed that the leisure and hospitality sector added 176,000 fewer jobs, professional and business services 158,000 fewer, and retailers 126,000 fewer. This weaker-than-expected data has fueled investor anxiety, as it suggests businesses may be becoming more reluctant to hire amid economic uncertainty. The numbers issued are preliminary, with final revisions scheduled for February 2026. 

JPMorgan Chase CEO Jamie Dimon added that the U.S. economy is "weakening," though he stopped short of predicting a recession. "Whether it's on the way to recession or just weakening, I don't know," he said. Dimon's remarks are closely watched, given his influence as head of one of the nation's largest banks.

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:

• Specialty Equipment Distributors company Custom Truck One Source (NYSE: CTOS) fell 4.3%. Is now the time to buy Custom Truck One Source? Access our full analysis report here, it’s free.
• Electrical Systems company LSI (NASDAQ: LYTS) fell 4.1%. Is now the time to buy LSI? Access our full analysis report here, it’s free.
• Home Construction Materials company Owens Corning (NYSE: OC) fell 4.1%. Is now the time to buy Owens Corning? Access our full analysis report here, it’s free.
• Electronic Components company Allient (NASDAQ: ALNT) fell 3.8%. Is now the time to buy Allient? Access our full analysis report here, it’s free.
• Engineered Components and Systems company Mayville Engineering (NYSE: MEC) fell 5.5%. Is now the time to buy Mayville Engineering? Access our full analysis report here, it’s free.

Zooming In On Mayville Engineering (MEC)

Mayville Engineering’s shares are somewhat volatile and have had 12 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 biggest move we wrote about over the last year was about 1 month ago when the stock dropped 16.3% on the news that the company reported disappointing second-quarter results and slashed its full-year financial guidance, citing weak market demand. The manufacturing company's sales fell 19.1% from the prior year, hit by customers reducing their stockpiles across key markets like agriculture and construction. This sales slump resulted in a net loss of $1.1 million, a stark contrast to the $3.8 million profit recorded in the same quarter last year. Looking forward, the company cut its full-year revenue and earnings forecasts, pointing to continued soft demand. In a significant move that added to investor worries, Mayville also withdrew its 2026 financial targets, citing an uncertain economic outlook and weak market conditions.

Mayville Engineering is down 8.6% since the beginning of the year, and at $14.21 per share, it is trading 34.8% below its 52-week high of $21.81 from November 2024. Investors who bought $1,000 worth of Mayville Engineering’s shares 5 years ago would now be looking at an investment worth $1,536.

Today’s young investors won’t have read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.