What Happened?
Shares of office furniture manufacturer MillerKnoll (NASDAQ: MLKN) fell 3.5% in the morning session after a potential major tariff investigation into furniture imported into the U.S., which could result in new duties being imposed within 50 days. The announcement, posted on social media, stated that an investigation into imported furniture will be completed within 50 days, after which tariffs at a "rate yet to be determined" would be implemented. The news sent a ripple of concern through the home goods industry, with shares of other retailers like RH and Williams Sonoma also declining. The potential for new duties comes at a challenging time for the sector, which is already contending with signs of slowing discretionary spending on big-ticket items like furniture. Broader economic indicators also point to a loss of momentum, adding to investor concerns that higher prices resulting from tariffs could further dampen consumer demand in an already fragile market.
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 MillerKnoll? Access our full analysis report here, it’s free.
What Is The Market Telling Us
MillerKnoll’s shares are somewhat volatile and have had 12 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 12 days ago when the stock gained 3.8% on the news that stocks continued to rally as investor optimism grew for a potential Federal Reserve interest rate cut in September. This optimism was largely fueled by a recent consumer price index report that showed inflation easing, along with public comments from Treasury Secretary Scott Bessent advocating for a significant 50-basis-point rate cut. The prospect of lower borrowing costs tends to boost rate-sensitive sectors like Business Services, as it can encourage companies to increase spending on consulting, IT projects, and staffing.
MillerKnoll is down 1.9% since the beginning of the year, and at $21.99 per share, it is trading 26.7% below its 52-week high of $29.98 from August 2024. Investors who bought $1,000 worth of MillerKnoll’s shares 5 years ago would now be looking at an investment worth $905.60.
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