What Happened?
A number of stocks jumped in the afternoon session after the major indices rebounded (Nasdaq +2.0%, S&P 500 +1.5%) as President Trump postponed the planned 50% tariff on European Union imports, shifting the start date to July 9, 2025.
Companies with substantial business ties to Europe likely had some relief as the delay reduced near-term cost pressures and preserved cross-border demand.
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:
- Advertising Software company AppLovin (NASDAQ: APP) jumped 5%. Is now the time to buy AppLovin? Access our full analysis report here, it’s free.
- Analog Semiconductors company Impinj (NASDAQ: PI) jumped 5.8%. Is now the time to buy Impinj? Access our full analysis report here, it’s free.
- Semiconductor Manufacturing company Teradyne (NASDAQ: TER) jumped 6.5%. Is now the time to buy Teradyne? Access our full analysis report here, it’s free.
- Consumer Electronics company GoPro (NASDAQ: GPRO) jumped 10%. Is now the time to buy GoPro? Access our full analysis report here, it’s free.
- Discount Retailer company Five Below (NASDAQ: FIVE) jumped 6.7%. Is now the time to buy Five Below? Access our full analysis report here, it’s free.
Zooming In On GoPro (GPRO)
GoPro’s shares are extremely volatile and have had 52 moves greater than 5% over the last year. But moves this big are rare even for GoPro and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 4 months ago when the stock dropped 21.7% on the news that the company reported disappointing fourth-quarter 2024 results, with revenue plunging 32% y/y. The company also missed expectations on both next-quarter revenue and EPS guidance.
The downturn was fueled by a 16% drop in camera sell-through as the company recorded a 34% slump in retail channel sales, which made up 74% of total revenue. Despite the sales decline, gross margin ticked up slightly, thanks to lower product costs.
However, this wasn't enough to offset the volume decline, leading to a non-GAAP net loss, compared to modest profits a year ago.
Looking ahead, GoPro aimed to slash operating expenses by nearly 30% in 2025, while shifting its focus to higher-priced cameras to stabilize margins. Still, with ongoing revenue pressures, the company's outlook remains uncertain.
GoPro is down 42.4% since the beginning of the year, and at $0.63 per share, it is trading 64% below its 52-week high of $1.76 from July 2024. Investors who bought $1,000 worth of GoPro’s shares 5 years ago would now be looking at an investment worth $131.14.
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