What Happened?
A number of stocks fell in the afternoon session after an unexpectedly sharp rise in wholesale inflation fueled concerns about rising costs and their impact on corporate profits. The primary catalyst was the July 2025 Producer Price Index (PPI), a measure of inflation at the wholesale level, which jumped 0.9% against forecasts of a 0.2% rise. This represents the most significant monthly increase in over three years, pointing to mounting cost pressures for manufacturers, with tariffs cited as a key factor. This data complicates the Federal Reserve's upcoming interest rate decisions, as persistent inflation may prevent rate cuts, creating a headwind for cyclical sectors like Industrials.
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:
- Ground Transportation company ArcBest (NASDAQ: ARCB) fell 3.1%. Is now the time to buy ArcBest? Access our full analysis report here, it’s free.
- Construction Machinery company Astec (NASDAQ: ASTE) fell 3.2%. Is now the time to buy Astec? Access our full analysis report here, it’s free.
- Renewable Energy company ChargePoint (NYSE: CHPT) fell 3.1%. Is now the time to buy ChargePoint? Access our full analysis report here, it’s free.
- General Industrial Machinery company Hillenbrand (NYSE: HI) fell 3.3%. Is now the time to buy Hillenbrand? Access our full analysis report here, it’s free.
- Automobile Manufacturing company Winnebago (NYSE: WGO) fell 3.2%. Is now the time to buy Winnebago? Access our full analysis report here, it’s free.
Zooming In On Hillenbrand (HI)
Hillenbrand’s shares are very volatile and have had 28 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 2 days ago when the stock gained 16% on the news that the company reported second-quarter results that beat Wall Street's expectations for both revenue and earnings. The industrial equipment maker reported second-quarter adjusted earnings of $0.51 per share and revenue of $598.9 million, surpassing Wall Street's forecasts of $0.50 per share and $572.5 million, respectively. While revenue declined 23.9% year over year, the beat on the top line was a positive for investors. Looking ahead, Hillenbrand provided an encouraging outlook, slightly raising its full-year revenue guidance and maintaining the midpoint of its adjusted earnings per share forecast.
Hillenbrand is down 16% since the beginning of the year, and at $25.58 per share, it is trading 27.6% below its 52-week high of $35.33 from January 2025. Investors who bought $1,000 worth of Hillenbrand’s shares 5 years ago would now be looking at an investment worth $781.55.
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