What Happened?
Shares of work management platform monday.com (NASDAQ:MNDY) fell 5.1% in the morning session after Barclays lowered its price target on the stock amid a broader market decline.
The investment bank trimmed its price target to $194 from $202, though it kept its "Overweight" rating on the shares. This adjustment came as some observers noted potential challenges, including revenue guidance for the fourth quarter of 2025 that fell short of expectations and pointed to slower growth.
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 monday.com? Access our full analysis report here, it’s free.
What Is The Market Telling Us
monday.com’s shares are very volatile and have had 26 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 5 days ago when the stock dropped 1.6% on the news that a broader market rotation out of the technology sector led to profit-taking following a recent rally.
The move was part of a wider trend that saw high-growth technology stocks fall, with the Nasdaq experiencing the sharpest decline among the major indices. Multiple reports indicated that traders were locking in profits, particularly from the artificial-intelligence trade, which had previously seen a strong run-up. This market action represented a shift in investor focus, as money moved out of tech.
Defense stocks emerged as the primary beneficiary of this capital shift, surging after President Trump proposed a massive $1.5 trillion defense budget for 2027. Major contractors rallied on the news, with Northrop Grumman jumping over 10% and Lockheed Martin gaining nearly 8%, providing a counterbalance to the tech slump that kept the S&P 500 flat. The rotation into heavy industry was further supported by a stabilization in energy markets, as crude prices rebounded.
monday.com is down 3.5% since the beginning of the year, and at $138.44 per share, it is trading 57.8% below its 52-week high of $327.92 from February 2025. Investors who bought $1,000 worth of monday.com’s shares at the IPO in June 2021 would now be looking at an investment worth $773.98.
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