Mid-Week Wrap-Up - March 26th, 2025

Strong start to the week, can it continue?

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Good morning investors!

If this is your first time reading, welcome to The Investor’s Edge — a thriving community of over 22,000 subscribers striving to be better investors with an edge in the market.

Every Wednesday we publish “The Mid-Week Wrap-Up” — your ticket to being well informed and staying ahead in the investment game!

This report is designed to help investors of all skill levels break down important stories/topics within the stock market. And best of all, we cut through all of the BS and give you exactly what you need to know in easy to digest, bite sized pieces of content.

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Grab your afternoon pick me up and let’s dive in.

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Market Talk

The major indexes all green to start the week, despite some weakness today. Treasury yields, oil and Bitcoin are also higher.

3 Stories Moving the Market

These are some of the biggest stories so far this week that are having an influence on market action.

Trump’s tariffs—here’s where they stand currently as White House continues to adjust its strategy

President Trump's tariffs are overhauling decades of U.S. free-trade policy, targeting both allies and rivals. By April 2—dubbed "Liberation Day"—he may impose retaliatory tariffs on all trade partners. Here’s the latest:

A 25% steel and aluminum tariff took effect March 12. The EU responded with counter-tariffs on $28 billion in U.S. goods, though some—like a 50% whiskey duty—were delayed, prompting Trump to threaten a 200% tariff on European spirits.

Canada and Mexico were hit with the same metal tariffs on March 4, but USMCA-compliant goods are exempt until April 2. Canada retaliated with tariffs on $20 billion of U.S. goods, and talks are ongoing.

Trump raised tariffs on China by another 20%, leading China to impose up to 15% duties on U.S. farm goods from March 10.

This week, he also announced a 25% "secondary tariff" on countries trading with Venezuela if they buy its oil or gas, effective April 2.

👉 EDGE TAKEAWAY: Tariffs remain a persistent source of market volatility, not just because of their economic impact, but because of…upgrade to Edge+ to read the full Edge Alert.

Apple is about to spend $1 billion on NVIDIA servers for AI

After sitting out the AI data center arms race, Apple $AAPL ( ▼ 2.66% ) is finally making a major move.

According to Loop Capital, Apple is ordering around $1 billion worth of Nvidia’s high-end GB300 NVL72 systems—roughly 250 servers—to build a large-scale generative AI cluster. The company is partnering with Dell and Super Micro Computer to support its efforts.

This shift comes amid internal struggles to launch AI-enabled features like a revamped Siri, which has been delayed indefinitely despite being heavily promoted.

Reports suggest Apple has reshuffled its executive team after setbacks that insiders described as “ugly” and “embarrassing.”

AAPL is +2.6% this week following the news.

📚 EDGE-UCATION: What is an AI server cluster?

An AI server cluster is a group of high-performance servers networked together to work as a single system, specifically designed to handle the massive computing demands of artificial intelligence tasks—especially training and running large language models (LLMs) like ChatGPT or image recognition systems.

Each server in the cluster typically includes powerful GPUs (graphics processing units), like Nvidia’s, because they’re far better than CPUs at the parallel processing required for AI workloads. By combining many of these servers, companies can dramatically increase their compute power, enabling them to train more advanced models, process huge datasets, or deliver faster AI-driven services.

Think of it as the AI equivalent of a sports team: each server is a strong individual player, but together in a tightly coordinated group, they can tackle far bigger challenges than one machine alone.

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Tesla's sales and market share in Europe drop again in February

Tesla's grip on the European EV market is slipping fast.

In February, its sales fell 42.6% year-over-year, even as overall battery-electric vehicle (BEV) registrations in Europe rose 26.1%. Tesla's share of the BEV market plunged from 21.6% to 10.3%, and its total market share dropped to just 1.8%.

The company sold fewer than 17,000 vehicles across the EU, UK, and EFTA countries—down from over 28,000 a year ago. With an aging lineup and growing competition from traditional automakers and aggressive Chinese entrants, Tesla is under increasing pressure ahead of its delayed Model Y refresh.

Adding to the company’s challenges, Canada has frozen all current Tesla EV rebate payments and banned the automaker from participating in future programs pending individual investigations into its claims.

Earnings Recap

With only two names reporting this week, we thought we would just include the breakdowns and our takeaways in the wrap-up as opposed to a separate email.

Dollar Tree (DLTR)

Dollar Tree $DLTR ( ▼ 5.46% ) reported mixed fourth-quarter results, with a modest revenue increase but sharply lower profits as higher operating costs and strategic review expenses weighed on margins—and a major announcement to divest its struggling Family Dollar business.

The company posted Q4 revenue of $5.00 billion, up 0.7% year-over-year, while net income from continuing operations declined 24.9% to $400.2 million. Adjusted EPS from continuing operations was $2.11, and total adjusted EPS including discontinued operations came in at $2.29, beating estimates by 4%.

Same-store sales at Dollar Tree rose 2.0%, driven by a 0.7% increase in traffic and a 1.3% rise in average ticket. However, operating income dropped 26.5% to $533.6 million as operating expenses rose 12% to $1.4 billion. Free cash flow for the year declined 26% to $893 million, though the company repurchased $403.6 million worth of shares. Dollar Tree ended the year with 8,881 stores, including 2,900 in the higher-priced Dollar Tree 3.0 format.

In a major strategic move, Dollar Tree announced it has entered into a definitive agreement to sell Family Dollar to Brigade Capital and Macellum Capital for $1.01 billion, with expected pre-tax proceeds of $804 million and roughly $350 million in tax benefits. The sale, expected to close in mid-2025, will allow the company to fully focus on optimizing the core Dollar Tree brand.

Looking ahead, Dollar Tree guided for full-year fiscal 2025 revenue of $18.5 billion to $19.1 billion (+~5% YoY) and adjusted EPS between $5.00 and $5.50. For Q1 2025, the company expects revenue between $4.5 billion and $4.6 billion, and EPS of $1.10 to $1.25.

👉 EDGE TAKEAWAY: Dollar Tree’s decision to offload Family Dollar is more than just a restructuring—it's the long-overdue undoing of a failed 2015 acquisition that never delivered. For years,…upgrade to Edge+ to read the full Edge Alert.

In Other News

In this section we'll be curating a selection of news headlines we think you'll find interesting. If a topic catches your eye, click the provided links to read more about it.

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The Second Half

The entire market is waiting for Friday’s PCE report, hence why we’ve seen flat trading since Monday’s relief rally. Nothing else really matters right now.

Earnings Reports

There’s only one name left to watch this week - Lululemon reports on Thursday. Here’s what we are expecting:

Here is the calendar of earnings releases scheduled for the rest of the week:

Source: Earnings Whisper

Economic Reports

We get initial jobless claims, GDP, pending home sales and consumer sentiment to end the week, but the major catalyst will be that key inflation report on Friday - all eyes will be on that release.

Here is the full calendar of events scheduled for the remainder of the week:

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Thank you for reading this edition of the Mid-Week Wrap-Up.

Until next time investors!

Mark & Chris

The Investor’s Edge

Disclosure

This is not investing advice. It is very important that you do your own research and make investments based on your own personal circumstances, preferences, goals and risk tolerance.

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