What Happened?
A number of stocks jumped in the afternoon session after comments from a key Federal Reserve official bolstered hopes for an interest rate cut. New York Federal Reserve President John Williams stated he sees “room for a further adjustment” in the near term, sparking a significant market rally. Following his remarks, the probability of the central bank cutting rates at its December meeting jumped from 39% to over 73%, according to the CME FedWatch tool. This positive sentiment provided relief to markets amid concerns over high valuations, particularly in AI-related stocks.
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:
- Patient Monitoring company Insulet (NASDAQ:PODD) jumped 6.8%. Is now the time to buy Insulet? Access our full analysis report here, it’s free for active Edge members.
- Testing & Diagnostics Services company Guardant Health (NASDAQ:GH) jumped 6.6%. Is now the time to buy Guardant Health? Access our full analysis report here, it’s free for active Edge members.
- Outpatient & Specialty Care company agilon health (NYSE:AGL) jumped 18.3%. Is now the time to buy agilon health? Access our full analysis report here, it’s free for active Edge members.
- Healthcare Technology for Providers company Evolent Health (NYSE:EVH) jumped 13.2%. Is now the time to buy Evolent Health? Access our full analysis report here, it’s free for active Edge members.
- Therapeutics company Myriad Genetics (NASDAQ:MYGN) jumped 7.2%. Is now the time to buy Myriad Genetics? Access our full analysis report here, it’s free for active Edge members.
Zooming In On agilon health (AGL)
agilon health’s shares are extremely volatile and have had 74 moves greater than 5% over the last year. But moves this big are rare even for agilon health 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 dropped 6.8% on the news that the company received a non-compliance notice from the New York Stock Exchange because its stock price fell below listing standards. The notice was issued after the stock's average closing price remained below $1.00 over a continuous 30-day period. This development followed the company's recent third-quarter report, which revealed a larger-than-expected loss. To address the potential delisting, agilon health stated it planned to seek a reverse stock split, which would need approval from its stockholders. The company was given a six-month period to regain compliance. Compounding the negative sentiment, a Barclays analyst had also lowered the price target on the stock in the previous session.
agilon health is down 67.7% since the beginning of the year, and at $0.62 per share, it is trading 89.1% below its 52-week high of $5.68 from April 2025. Investors who bought $1,000 worth of agilon health’s shares at the IPO in April 2021 would now be looking at an investment worth $20.03.
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