What Happened?
A number of stocks fell in the afternoon session after the April PPI report lifted the 10-year Treasury yield to a 10-month high of 4.49%, eliminating 2026 rate-cut expectations and raising the discount rate for long-duration growth valuations.
This 'sticky' inflation print also signaled that consumer real wages have turned negative (3.6% wages vs 3.8% CPI), which historically triggers a pullback in digital advertising budgets as brands protect margins.
Consumer internet companies like Google, Meta, Amazon, and Netflix, earn revenue from digital advertising and subscriptions. Their valuations are highly sensitive to Treasury yields, which set the bar for growth-stock multiples.
Two forces drove the reaction. First, the rate channel is direct: 10-month high yields mechanically reduce the present value of future earnings. Second, the demand channel: negative real wage growth signals that consumers are under pressure, and advertisers typically respond by tightening budgets. While the Q1 ad cycle was strong, the PPI suggested the macro environment was turning against the next quarter's growth targets.
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:
- Online Marketplace company LegalZoom (NASDAQ: LZ) fell 5.9%. Is now the time to buy LegalZoom? Access our full analysis report here, it’s free.
- Social Networking company Pinterest (NYSE: PINS) fell 6.2%. Is now the time to buy Pinterest? Access our full analysis report here, it’s free.
- Online Marketplace company EverQuote (NASDAQ: EVER) fell 6.3%. Is now the time to buy EverQuote? Access our full analysis report here, it’s free.
Zooming In On EverQuote (EVER)
EverQuote’s shares are very volatile and have had 20 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 biggest move we wrote about over the last year was 6 months ago when the stock gained 11.4% on the news that the company reported strong third-quarter financial results that surpassed analyst expectations for both revenue and earnings.
The online insurance marketplace announced quarterly revenue of $173.9 million, a 20.3% increase year-over-year that beat analyst estimates. Earnings per share also impressed, coming in at $0.50, which was significantly higher than the consensus forecast of $0.38. Adding to the positive sentiment, the company provided an optimistic outlook for the fourth quarter, guiding for revenue of $177 million at the midpoint, which was well above what analysts were expecting.
EverQuote is down 29.8% since the beginning of the year, and at $17.84 per share, it is trading 36% below its 52-week high of $27.87 from December 2025. Investors who bought $1,000 worth of EverQuote’s shares 5 years ago would now be looking at only $606.80.
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