QXO Stock Drop Looks Sharp, But How Deep Can It Go?
QXO (QXO) stock is down 10.9% in 5 trading days. The recent slide reflects concerns over soft roofing demand and lowered earnings estimates, compounded by acquisition complexities, but sharp drops like this often raise a tougher question: is the weakness temporary, or a sign of deeper cracks in the story?
Before judging its downturn reslience, let’s look at where QXO stands today.
- Size: QXO is a $14 Bil company with $4.7 Bil in revenue currently trading at $19.29.
- Fundamentals: Last 12 month revenue growth of 8117.4% and operating margin of -4.5%.
- Liquidity: Has Debt to Equity ratio of 0.29 and Cash to Assets ratio of 0.14
- Valuation: QXO stock is currently trading at P/E multiple of -77.6 and P/EBIT multiple of -454.6
- Has returned (median) 80% within a year following sharp dips since 2010. See QXO Dip Buy Analysis.
These metrics point to a Moderate operational performance, alongside Moderate valuation – making the stock Fairly Priced. For details, see Buy or Sell QXO Stock
That brings us to the key consideration for investors worried about this fall: how resilient is QXO stock if markets turn south? This is where our downturn resilience framework comes in. Suppose QXO stock falls another 20-30% to $14 – can investors comfortably hold on? Turns out, the stock has fared worse than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and, (b) how quickly it recovered. Below, we dive deeper into each such downturn.
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2022 Inflation Shock
- QXO stock fell 83.8% from a high of $112.72 on 6 July 2021 to $18.27 on 11 May 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 28 December 2023
- Since then, the stock increased to a high of $235.61 on 10 June 2024 , and currently trades at $19.29
| QXO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -83.8% | -25.4% |
| Time to Full Recovery | 596 days | 464 days |
2020 Covid Pandemic
- QXO stock fell 60.6% from a high of $30.31 on 6 January 2020 to $11.95 on 3 April 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 4 August 2020
| QXO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -60.6% | -33.9% |
| Time to Full Recovery | 123 days | 148 days |
2018 Correction
- QXO stock fell 60.8% from a high of $32.41 on 24 July 2017 to $12.71 on 4 January 2019 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 4 August 2020
| QXO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -60.8% | -19.8% |
| Time to Full Recovery | 578 days | 120 days |
2008 Global Financial Crisis
- QXO stock fell 97.3% from a high of $0.02 on 23 February 2007 to $0.00 on 13 November 2007 vs. a peak-to-trough decline of 56.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 18 July 2011
| QXO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -97.3% | -56.8% |
| Time to Full Recovery | 1,343 days | 1,480 days |
Feeling jittery about QXO stock? Consider portfolio approach.
Stock Picking Falls Short Against Multi Asset Portfolios
Individual picks are volatile but diversified assets offset each other. A multi asset portfolio helps you stay the course capture upside and reduce downside.
The asset allocation framework of Trefis’ Boston-based, wealth management partner yielded positive returns during the 2008-09 period when the S&P lost more than 40%. Our partner’ strategy now includes Trefis High Quality Portfolio, which has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices