What Happened?

A number of stocks jumped in the afternoon session after comments from a key Federal Reserve official boosted hopes for an interest rate cut. New York Federal Reserve President John Williams stated he sees “room for a further adjustment” in the near term, sparking a significant market rally. Following his remarks, the probability of the central bank cutting rates at its December meeting jumped from 39% to over 73%, according to the CME FedWatch tool. This positive sentiment provided relief to markets amid concerns over high valuations, particularly in AI-related stocks.

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:

• Regional Banks company BancFirst (NASDAQ: BANF) jumped 3.8%. Is now the time to buy BancFirst? Access our full analysis report here, it’s free for active Edge members.
• Regional Banks company Zions Bancorporation (NASDAQ: ZION) jumped 3.9%. Is now the time to buy Zions Bancorporation? Access our full analysis report here, it’s free for active Edge members.
• Regional Banks company Synovus Financial (NYSE: SNV) jumped 3.8%. Is now the time to buy Synovus Financial? Access our full analysis report here, it’s free for active Edge members.
• Regional Banks company Prosperity Bancshares (NYSE: PB) jumped 3.9%. Is now the time to buy Prosperity Bancshares? Access our full analysis report here, it’s free for active Edge members.
• Regional Banks company Origin Bancorp (NYSE: OBK) jumped 3.9%. Is now the time to buy Origin Bancorp? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Origin Bancorp (OBK)

Origin Bancorp’s shares are not very volatile and have only had 5 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 previous big move we wrote about was 29 days ago when the stock dropped 3.8% on the news that the company reported third-quarter financial results that showed a significant miss on profit expectations, even as revenue surpassed forecasts. The regional bank posted an adjusted loss per share of $0.59, starkly contrasting with analyst estimates of a $0.69 profit. On a positive note, the company's revenue for the quarter was strong, coming in at $109.8 million. This figure was up 21% year-on-year and beat Wall Street's consensus estimate by 7.6%. Despite the strong top-line performance, the substantial earnings miss appeared to be the primary concern for investors, overshadowing the revenue beat and leading to the stock's decline.

Origin Bancorp is up 6.3% since the beginning of the year, but at $35.39 per share, it is still trading 13.5% below its 52-week high of $40.93 from February 2025. Investors who bought $1,000 worth of Origin Bancorp’s shares 5 years ago would now be looking at an investment worth $1,372.

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