What Happened?
Shares of contract logistics company GXO (NYSE:GXO) fell 13.9% in the morning session after Bloomberg reported that the company turned down acquisition offers after exploring options in recent months. The stock recorded double-digit gains after Bloomberg first reported news of a potential sale. However, today's move indicates the market is adjusting its expectations, tempering enthusiasm around a possible acquisition. Separately, Chief Executive Officer Malcolm Wilson announced plans to retire next year (2025), creating additional uncertainty, which the market doesn't like.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy GXO Logistics? Access our full analysis report here, it’s free.
What The Market Is Telling Us
GXO Logistics’s shares are not very volatile and have only had 6 moves greater than 5% over the last year. Moves this big are rare for GXO Logistics and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was about 2 months ago when the stock gained 15.4% on the news that the company is reportedly exploring a potential sale after receiving takeover interest. The sources added, "GXO has not made a final decision to proceed with a sale, and it is possible that the talks may not result in a deal."
GXO Logistics is down 15% since the beginning of the year, and at $51.09 per share, it is trading 18.9% below its 52-week high of $63.01 from October 2024. Investors who bought $1,000 worth of GXO Logistics’s shares at the IPO in July 2021 would now be looking at an investment worth $937.50.
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