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Wynn Resorts, Federal Signal, Watsco, Graco, and Allison Transmission Shares Are Soaring, What You Need To Know

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What Happened?

A number of stocks jumped in the afternoon session after the major indices rebounded, as Fed Chair Jerome Powell delivered dovish remarks at the much-awaited Jackson Hole symposium. Powell suggested that with inflation risks moderating and unemployment remaining low, the Federal Reserve might consider a shift in its monetary policy stance, including potential interest rate cuts. This outlook eased market concerns about prolonged high interest rates and their impact on economic growth. The prospect of lower borrowing costs bolstered investor confidence, particularly in sectors that have lagged, leading to a broad rally across the market.

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:

Zooming In On Graco (GGG)

Graco’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 29 days ago when the stock dropped 3.6% on the news that the company reported second-quarter financial results that missed analyst expectations on both revenue and earnings per share. Graco's adjusted earnings per share for the second quarter was 75 cents, missing the consensus estimate of 79 cents. Net sales increased by 3.4% year-over-year to $571.8 million but also fell short of the estimated $585.4 million. While acquisitions helped boost total sales, the company's organic revenue, which reflects core business performance, actually declined by 3%. Management attributed this to weaknesses in North American construction markets, which hurt sales in its Contractor segment. Furthermore, profitability faced pressure as component costs rose due to new tariffs. Looking ahead, Graco provided a cautious outlook for the rest of 2025, projecting low single-digit growth.

Graco is up 4.5% since the beginning of the year, and at $87.30 per share, it is trading close to its 52-week high of $92.29 from November 2024. Investors who bought $1,000 worth of Graco’s shares 5 years ago would now be looking at an investment worth $1,501.

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