Dan Ives, a Wedbush analyst, recently expressed his views on President Donald Trump’s proposal to impose a 25% tariff on all imported cars, describing the situation as “pure chaos.” On April 3, Ives and his team released a research note addressing the impact of Trump’s latest tariff announcements, which have contributed to a decline in stock prices. The note carried the title, “What To Do After Trump Dropped This Economic Armageddon Tariff Slate?”
In a statement, Ives highlighted that President Trump presented a reciprocal-tariff chart in the Rose Garden at the White House, which he described as illogical and likely to be memorable in economic studies for years. After consulting with business leaders and supply chain experts globally, Ives indicated that the investment firm views these tariffs as a starting point for negotiations to create a more equitable trading environment with various countries and companies.
According to Ives, tech companies heavily reliant on China for manufacturing, market access, and revenue, such as Apple, Nvidia, Tesla, and Taiwan Semiconductor, will face significant pressure. Tariffs imposed on China and Taiwan are expected to impact these companies severely.
Ives cautioned that the burden of these tariffs ultimately falls on U.S. consumers, aligning with basic economic theory. The uncertainty arising from the announcements is anticipated to lead to changes across the tech industry, with companies potentially withholding earnings guidance due to economic unpredictabilities reminiscent of early pandemic uncertainties.
Apple, set to report earnings on May 1, has seen its stock rise 20% over the past year but faced a decline of nearly 9% as of April 3. Ives maintains an outperform rating on Apple, with a price target of $325.
Other investment firms have also chimed in following the tariff announcement. Citi retains a buy rating with a price target of $275 while warning of a 9% negative impact on Apple’s gross margin due to China’s manufacturing share. The new tariffs are expected to take effect on April 9, with more details awaited from Apple and the administration.
Bank of America Securities cut their price target on Apple to $250 from $265, maintaining a buy rating. The investment firm indicated that Apple may need to manage its supply chain strategically to mitigate tariff impacts but could face significant financial consequences if unable to offset headwinds.
In the wake of Trump’s tariffs, France has encouraged the European Union to retaliate against U.S. tech companies, as reported by Bloomberg. The EU is considering employing its anti-coercion instrument to counter the U.S. actions, with potential responses anticipated by the end of April. The issue of taxing digital services has been divisive within the EU, with countries like France and Italy implementing national taxes, while Germany remains opposed.
