What Happened?
A number of stocks fell in the afternoon session after concerns regarding lofty artificial intelligence valuations triggered a pullback in the technology sector.
Nvidia slid 3% ahead of its earnings report, dragging down fellow "Magnificent Seven" peers despite a major partnership announcement with Anthropic, as investors increasingly question the durability of the AI rally. Market sentiment was further dampened by Bitcoin dropping below $90,000, signaling reduced risk appetite, and growing anxiety that the Federal Reserve may pause rate cuts in December, with the implied probability of a cut falling to roughly 50%. Adding to the weakness, Home Depot shares declined following an earnings miss and a cut to its full-year outlook. This combination of continued de-risking and valuation skepticism put the S&P 500 on pace for its fourth consecutive daily decline.
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:
- E-commerce Software company Commerce (NASDAQ: CMRC) fell 2.8%. Is now the time to buy Commerce? Access our full analysis report here, it’s free for active Edge members.
- Automation Software company Microsoft (NASDAQ: MSFT) fell 3.2%. Is now the time to buy Microsoft? Access our full analysis report here, it’s free for active Edge members.
- Document Management company Box (NYSE: BOX) fell 3.8%. Is now the time to buy Box? Access our full analysis report here, it’s free for active Edge members.
- Video Conferencing company RingCentral (NYSE: RNG) fell 3.2%. Is now the time to buy RingCentral? Access our full analysis report here, it’s free for active Edge members.
- Sales Software company ZoomInfo (NASDAQ: GTM) fell 2.7%. Is now the time to buy ZoomInfo? Access our full analysis report here, it’s free for active Edge members.
Zooming In On Box (BOX)
Box’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 6 months ago when the stock gained 17.6% on the news that the company reported a "beat and raise" quarter (fiscal Q1 2026).
Box blew past analysts' sales and billings expectations, and its EPS guidance for next quarter trumped Wall Street's estimates. Notably, the company raised full-year sales and earnings guidance off the back of the strong first quarter beat. It also called out the early success of its new Enterprise Advanced Suite, which bundles AI-powered tools for managing and automating content workflows, an area with growing enterprise interest. Zooming out, we think this was a good print with some key areas of upside.
Box is down 5.3% since the beginning of the year, and at $29.67 per share, it is trading 23% below its 52-week high of $38.55 from June 2025. Investors who bought $1,000 worth of Box’s shares 5 years ago would now be looking at an investment worth $1,718.
Microsoft, Alphabet, Coca-Cola, Monster Beverage—all began as under-the-radar growth stories riding a massive trend. We’ve identified the next one: a profitable AI semiconductor play Wall Street is still overlooking.Go here for access to our full report.
