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A number of stocks fell in the afternoon session after the major indices pulled back (Nasdaq -1.3%, S&P 500 -1.1%) as Israel carried out significant strikes on Iranian nuclear and military sites, dramatically escalating fears of a broader conflict in the Middle East. This development has sent crude oil prices surging, as investors fear potential disruptions to global oil supply and a wider regional conflict.
The conflict intensified investor anxiety, compounding existing market volatility, especially in risk assets like stocks, and prompting a pronounced shift toward safe-haven assets.
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:
Oxford Industries’s shares are very volatile and have had 20 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 1 day ago when the stock dropped 11.6% on the news that the company reported weak first-quarter 2025 results, as it dropped its full-year sales and earnings per share forecast.
Taking a closer look at the quarter, revenue fell 1.3% year-on-year, with a big drop in sales at Johnny Was and a smaller dip at Tommy Bahama, which together erased gains at Lilly Pulitzer. Margins took a hit, too, due to a rise in shipping costs, deeper discounts to clear old inventory, and a greater share of lower-margin wholesale sales. Higher costs from running more stores pushed expenses up, crimping operating margin.
As a result, EPS fell compared to the previous year. The company lowered its full-year forecast, expecting sales to shrink slightly, hurt by rising tariffs (including $40 million inadditional tariff costs).
Overall, it was a weak quarter, with falling margins, declining sales, and lowered guidance all pointing to a tougher road ahead.
Oxford Industries is down 49.6% since the beginning of the year, and at $39.57 per share, it is trading 62.8% below its 52-week high of $106.50 from July 2024. Investors who bought $1,000 worth of Oxford Industries’s shares 5 years ago would now be looking at an investment worth $924.20.
Today’s young investors won’t have read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.
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