What Happened?
A number of stocks jumped in the afternoon session after the ISM Services PMI Report showed the business services sector continued to expand in June.
The Institute for Supply Management (ISM) reported that its Services PMI registered 54 percent. While this is a slight decrease of 0.5 percentage point from May’s reading of 54.5 percent, it marks the 24th consecutive month of growth for the sector. A PMI reading above 50 percent indicates that the services sector economy is generally expanding. The sustained period of expansion suggests a resilient economic backdrop for service-oriented companies, signaling healthy business activity and 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:
Zooming In On Alight (ALIT)
Alight’s shares are extremely volatile and have had 55 moves greater than 5% over the last year. But moves this big are rare even for Alight and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 14 days ago when the stock gained 1.4% on the news that DA Davidson reiterated its Buy rating and $2.00 price target on the company’s stock.
The analyst’s reaffirmation followed Alight’s announcement of a 1-for-20 reverse stock split. Companies sometimes enact reverse stock splits to regain compliance with stock exchange listing requirements. Despite this move, DA Davidson’s price target represents significant potential upside from Alight’s recent price.
The analyst noted that with major changes to senior management over the previous six months, 2026 is viewed as a transition year. The positive analyst sentiment may also be supported by Alight’s strong first-quarter 2026 financial results, where the company surpassed both earnings and revenue expectations.
Alight is up 777% since the beginning of the year, and at $16.49 per share, it has set a new 52-week high. Investors who bought $1,000 worth of Alight’s shares 5 years ago would now be looking at an investment worth $1,826.
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Source: Original Article
