What Happened?

A number of stocks jumped in the afternoon session after markets continued to rally amid growing speculation of an impending interest rate cut by the Federal Reserve. Following a favorable Consumer Price Index (CPI) report, investors are increasingly betting on a rate reduction next month, a sentiment amplified by U.S. Treasury Secretary Scott Bessent's call for a significant cut. This has fueled a 'risk-on' environment across Wall Street. Lower interest rates are typically beneficial for growth-oriented sectors like healthcare, as they reduce the cost of borrowing for research and innovation and increase the present value of future earnings.

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:

• Testing & Diagnostics Services company NeoGenomics (NASDAQ: NEO) jumped 3.2%. Is now the time to buy NeoGenomics? Access our full analysis report here, it’s free.
• Health Insurance Providers company Progyny (NASDAQ: PGNY) jumped 5.1%. Is now the time to buy Progyny? Access our full analysis report here, it’s free.
• Drug Development Inputs & Services company Repligen (NASDAQ: RGEN) jumped 3.4%. Is now the time to buy Repligen? Access our full analysis report here, it’s free.
• Research Tools & Consumables company Revvity (NYSE: RVTY) jumped 3%. Is now the time to buy Revvity? Access our full analysis report here, it’s free.
• Research Tools & Consumables company Waters Corporation (NYSE: WAT) jumped 3.4%. Is now the time to buy Waters Corporation? Access our full analysis report here, it’s free.

Zooming In On Progyny (PGNY)

Progyny’s shares are somewhat volatile and have had 13 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 previous big move we wrote about was 23 days ago when the stock gained 3.1% on the news that the stock gained ground amid a broader market rally as investors looked ahead to a busy week of corporate earnings reports. There was no significant company-specific news to explain the move, suggesting its shares were lifted by positive market sentiment. U.S. stock futures pointed to a higher open for the markets, setting an upbeat tone for investors who were anticipating a heavy slate of earnings reports from major companies. 

Notably, the earnings season got off to a strong start: More than 85% of the S&P 500 stocks that reported earnings exceeded expectations, according to FactSet data. This robust performance fueled positive sentiment, suggesting that corporate profitability remained resilient despite ongoing economic uncertainties. The fertility-benefits manager had been a topic of interest for investors following a business update on July 8, when it announced it expected second-quarter financial results to be slightly better than previous guidance. The company also secured a new $200 million revolving credit facility to enhance its financial flexibility.

Progyny is up 30.7% since the beginning of the year, and at $23.18 per share, it is trading close to its 52-week high of $24.82 from September 2024. Investors who bought $1,000 worth of Progyny’s shares 5 years ago would now be looking at an investment worth $793.29.

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