WEBVTT - Apple Slips, Dollar Tree Rises, MicroStrategy Falls on Tariff Concerns

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

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<v Speaker 2>Stock Movers podcast, your roundup of companies making moves in

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

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<v Speaker 3>Take a look at on the stocks in the move today,

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<v Speaker 3>joined now by Bloomberg's Isabel Lee Bloomer, Cross Asset Reporter,

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<v Speaker 3>speaking of you're talking about.

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<v Speaker 1>Apple getting a downgrade, getting a down grade, and that's

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<v Speaker 1>why it shares our sinking lower by five percent today.

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<v Speaker 1>So the price target is cut to two point fifty

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<v Speaker 1>from three twenty five. And wet Bush dan ives which

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<v Speaker 1>is one of the biggest bulls sites of Trump administration's

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<v Speaker 1>tariff policy. So he said that the tariff economic armageddon

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<v Speaker 1>unleashed by Trump is a complete disaster for Apple given

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<v Speaker 1>its massive China production exposure. And as we know, Apple

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<v Speaker 1>really sources majority of its supplies and equipment and all

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<v Speaker 1>of those from China. And recall that the tiff rates

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<v Speaker 1>related for China is at fifty four percent. Taiwan, where

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<v Speaker 1>it gets a lot of those, is also thirty two percent.

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<v Speaker 1>So those would really be devastating to Apple It's cost

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<v Speaker 1>structure and ultimately consumer demand. But here's a catch. I

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<v Speaker 1>still has an outperformance rating for Apple.

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<v Speaker 3>I mean, yeah, yeah, yeah, I mean so that's bread. Yeah,

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<v Speaker 3>it's his brand for sure, but the details there are

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<v Speaker 3>quite striking. A Dollar Tree, let's go through here. This

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<v Speaker 3>also is getting some analyst comments today, But I like Dollar.

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<v Speaker 1>Tree because it's engine higher by almost eight percent. City

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<v Speaker 1>basically turned bullish. So City anticipates that the higher across

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<v Speaker 1>the board tiff only positive for the discount retailer. And

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<v Speaker 1>I got excited when I was reading this story because

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<v Speaker 1>most of the Tireff effect is on the negative side.

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<v Speaker 1>So City says that the higher across the board tiff

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<v Speaker 1>will be positive. Because he said that they added the

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<v Speaker 1>price target. If Dollar Tree basically increases from one dollar

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<v Speaker 1>to one twenty five or one fifty or one seventy five,

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<v Speaker 1>it will seem inevitable, but consumers would be quote accepting

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<v Speaker 1>of the magnitude of change. And he acknowledges though that

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<v Speaker 1>around fifty percent of the company's product is subject to

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<v Speaker 1>higher tariffs. But still he says that he believes that

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<v Speaker 1>they can overcome this. He changed price target to one

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<v Speaker 1>hundred and three from seventy six dollars, and the company

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<v Speaker 1>may benefit from consumers also trading lower, so maybe more

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<v Speaker 1>people will go to dollar Tree. Okay, very good. I

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<v Speaker 1>don't know see about it.

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<v Speaker 3>I mean, yeah, it's just I guess the reason behind

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<v Speaker 3>it is a little disturbing when you take a lot

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<v Speaker 3>of the recession ons at Goldman and JP Morgan also taken.

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<v Speaker 1>Back up as well. Still some margin impression, I would

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<v Speaker 1>think as well, Man, the cost to get sold are

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<v Speaker 1>going to go up.

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<v Speaker 3>Yeah, little boy, a micro strategy. Let's end it here.

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<v Speaker 3>So this is the bitcoin proxy, right.

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<v Speaker 1>Bitcoin proxy, hedge fund proxy of bitcoin. Basically they're edging

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<v Speaker 1>lware by nine percent. Micro Strategy said strategy. Rather, it

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<v Speaker 1>will register and unrealized five point nine billion laws in

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<v Speaker 1>the first quarter, and that's after they adopted this accounting

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<v Speaker 1>change that requires them to value bitcoin at market prices.

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<v Speaker 1>So the company now holds forty one point eight billion

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<v Speaker 1>dollars worth of bitcoin and that fell by nearly five

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<v Speaker 1>billion in the first quarter, and that's because we saw

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<v Speaker 1>bitcoin drop around twelve percent, So this was really long timecoming.

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<v Speaker 1>Strategy waited until the first quarter to adopt this accounting change.

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<v Speaker 1>So prior to the change, Strategy has been classifying bitcoin

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<v Speaker 1>as intangible, meaning it similar to trademarks. Or brand recognition,

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<v Speaker 1>and this designation really forced Strategy to permanently, permanently mark

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<v Speaker 1>down the value of its holding, So that's why they

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<v Speaker 1>had this change, but it's still not good.

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