WEBVTT - Fannie-Freddie, Micron Sink; Darden Restaurants Fluctuates

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio News.

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<v Speaker 2>The Stock Movers report, your roundup of companies making moves

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<v Speaker 2>in the stock market, harnessing the power of Bloomberg Data.

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<v Speaker 1>I'm Jim Stadebeck along with Carol Masser. Let's take a

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<v Speaker 1>look at some stocks on the move today. We're joined

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<v Speaker 1>by Bloomberg News process at reporter Denizza Sokova, Denitza Watts.

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<v Speaker 3>Are you watching If you think it's a rough day

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<v Speaker 3>for stocks, look at Funny and Freddy. They were down

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<v Speaker 3>as much as twenty two and sixteen percent. The tickers,

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<v Speaker 3>of course are FNMA, FMCC. It's been a really tough

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<v Speaker 3>stretch for those companies. They're down about seventy percent in

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<v Speaker 3>the last six months. There was so much support from

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<v Speaker 3>the White House and stock investors mentioned met this with

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<v Speaker 3>a lot of enthusiasm. Of course, people were expecting after

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<v Speaker 3>the election that the White House would take steps to

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<v Speaker 3>release the company from government control. Trump of course tweeted

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<v Speaker 3>that they want take the company public. But we haven't

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<v Speaker 3>heard anything for a very long time, and investors are

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<v Speaker 3>not reacting quite well to this. Everyone's worried about housing affordability.

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<v Speaker 3>Mid terms are coming. You probably don't want to take

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<v Speaker 3>those companies public in a time where people are so

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<v Speaker 3>conscious about mortgage prices, and perhaps that's one of the

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<v Speaker 3>reasons we're seeing this. And of course we have a

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<v Speaker 3>war in Iran, so the administration has a lot of

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<v Speaker 3>other things to deal with.

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<v Speaker 4>I also keep wondering this gets to this argument should

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<v Speaker 4>these They've always been quasi public and they've gone back

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<v Speaker 4>and forth here, but you know, if this is something

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<v Speaker 4>like should they be public entities? And I think we've

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<v Speaker 4>talked with Chris Whalen about this that says probably not,

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<v Speaker 4>I think is what has been his argument. But yeah,

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<v Speaker 4>really getting bumped up and banged around.

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<v Speaker 1>A couple way here on my list.

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<v Speaker 4>Don't ticker fn M A and fre Yes, Okay, just

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<v Speaker 4>got to remember. Okay, let's go to Micron. This is

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<v Speaker 4>something we talked about certainly after the close a lot yesterday,

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<v Speaker 4>but we continue in today's session. Two.

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<v Speaker 3>Yeah, I have one more decliner and that is in

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<v Speaker 3>the Micron actually a pretty strong earnings report. Nevertheless, everyone

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<v Speaker 3>cares about the costs. They're spending heavy on production, a

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<v Speaker 3>lot heavier than investors were expecting. Capital spending will exceed

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<v Speaker 3>twenty five billion this fiscal year. Analysts, we're expecting about

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<v Speaker 3>twenty two billion, so pretty big gap. And clearly this

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<v Speaker 3>is a company that has been sowing for a very

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<v Speaker 3>long time. The ticker is m you it has risen

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<v Speaker 3>sixty two percent going into this report, so incredible, incredible rally.

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<v Speaker 3>But Micron sales are very strong. They expected to keep sowing,

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<v Speaker 3>but memory prices have also been sowing, and clearly that's

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<v Speaker 3>putting a lot of tension even at a company that's

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<v Speaker 3>like one of investor's favorites.

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<v Speaker 4>Listen, it's great for margins, right, but you've got to

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<v Speaker 4>meet that demand. So that's why they're increasing probably their

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<v Speaker 4>cap X. But it's like, Okay, great job, I love

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<v Speaker 4>the numbers, but why do you have to spend so much?

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<v Speaker 4>But like it's it's chicken or the egg, Like you

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<v Speaker 4>got a bill to be able to meet supply. But

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<v Speaker 4>there's always that concern of overbuilding, right, and then as we.

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<v Speaker 1>Know these exactly where are we in the cycle comes

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<v Speaker 1>to when the stuff gets online and how much will

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<v Speaker 1>people be willing to pay? And you know, given that

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<v Speaker 1>there's only like three providers including Micron, that do this,

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<v Speaker 1>they're in a pretty good position when it comes to Yeah,

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<v Speaker 1>supplying that demand.

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<v Speaker 3>Yeah, but the balance is hard. The innovation were suspending.

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<v Speaker 3>It's always hard.

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<v Speaker 4>Yeah, investors are not always happy. I felt like for

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<v Speaker 4>a while we were fined on the spend, and then

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<v Speaker 4>it was like, no so much. Let's got a darden restaurants.

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<v Speaker 3>Yeah, we're going to talk about food and Olive Gardens.

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<v Speaker 3>They're having some promotion buy one, get one, and it's

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<v Speaker 3>working out pretty well. The company is now having a

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<v Speaker 3>small game, but in earlier trading it jumped as much

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<v Speaker 3>as three percent. The Darten now expects Fisco twenty twenty

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<v Speaker 3>six same store sales to grow about four and a

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<v Speaker 3>half percent. This is much higher than what they previously saw.

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<v Speaker 3>The positive outlook is for Olive Garden. That's where a

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<v Speaker 3>lot of the support is coming. Some interesting things. They

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<v Speaker 3>introduced those lighter portion menules that offer smaller, cheapen meals.

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<v Speaker 3>That's not working so well for their margins, so some

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<v Speaker 3>pressure there. Perhaps we'll leave ones right Yeah really, yeah,

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<v Speaker 3>I are so, but it didn't work. I didn't know

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<v Speaker 3>it's not working well Italy.

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<v Speaker 2>The Stock Movers report from Bloomberg Radio. Check back with

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