What Happened?
A number of stocks fell in the afternoon session after markets pulled back with the decline concentrated in the tech space as investors engaged in profit-taking following a robust week that saw the S&P 500 hit a new record.
Adding to the pressure, new inflation data, specifically the Core PCE, showed an acceleration in July, signaling that rising prices remain a risk despite being in line with expectations. This confluence of factors, including market highs heading into a historically weak September, led to a pullback, with the Nasdaq Composite shedding 1.15%. While the Federal Reserve has hinted at potential rate cuts, the focus on inflation and the jobs market continues to influence investor sentiment.
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:
- Electronic Components & Manufacturing company Amphenol (NYSE: APH) fell 3%. Is now the time to buy Amphenol? Access our full analysis report here, it’s free.
- Discount Grocery Store company Dollar General (NYSE: DG) fell 3.1%. Is now the time to buy Dollar General? Access our full analysis report here, it’s free.
- Apparel Retailer company Zumiez (NASDAQ: ZUMZ) fell 3.1%. Is now the time to buy Zumiez? Access our full analysis report here, it’s free.
- Discount Retailer company Ollie's (NASDAQ: OLLI) fell 3.6%. Is now the time to buy Ollie's? Access our full analysis report here, it’s free.
- Aerospace company AerSale (NASDAQ: ASLE) fell 3.7%. Is now the time to buy AerSale? Access our full analysis report here, it’s free.
Zooming In On AerSale (ASLE)
AerSale’s shares are quite volatile and have had 17 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 21 days ago when the stock gained 9.1% on the news that the company posted second-quarter results that beat analyst expectations on both the top and bottom lines.
The aviation solutions provider reported adjusted earnings of $0.20 per share, crushing Wall Street's consensus estimate of $0.03. Revenue also impressed, rising 39.3% year-over-year to $107.4 million, which was well ahead of the $86.33 million analysts had anticipated. This performance highlights healthy demand for the company's offerings, which include sales, leasing, and maintenance for mid-life commercial aircraft. The company's profitability saw a dramatic improvement, as its operating margin surged to 11.7%, a significant turnaround from a negative 2.4% in the same quarter last year. This strong bottom-line result was also reflected in its free cash flow, which turned positive at $18.61 million, compared to a burn of $18.94 million in the prior-year period.
AerSale is up 39.9% since the beginning of the year, and at $8.62 per share, it is trading close to its 52-week high of $9 from August 2025. Investors who bought $1,000 worth of AerSale’s shares 5 years ago would now be looking at an investment worth $838.52.
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