What Happened?

A number of stocks fell in the afternoon session after the Trump administration's announcement of new global tariffs, reignited trade policy uncertainty. The move came swiftly after the Supreme Court ruled the previous week that the president could not use the International Emergency Economic Powers Act (IEEPA) for such duties, a decision that had initially sent markets higher. However, the administration invoked a different authority, the Trade Act of 1974, to impose a 15% global tariff for up to 150 days. The rapid reimposition of trade barriers creates significant uncertainty for companies across multiple sectors that depend on international supply chains and global trade. Investors are now weighing the potential impact of these new duties on corporate earnings and broader economic activity.

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:

• Consumer Discretionary - Leisure Products company MasterCraft (NASDAQ: MCFT) fell 4.5%. Is now the time to buy MasterCraft? Access our full analysis report here, it’s free.
• Consumer Discretionary - Leisure Products company Clarus (NASDAQ: CLAR) fell 3.7%. Is now the time to buy Clarus? Access our full analysis report here, it’s free.
• Consumer Discretionary - Media company Warner Music Group (NASDAQ: WMG) fell 5%. Is now the time to buy Warner Music Group? Access our full analysis report here, it’s free.
• Consumer Discretionary - Specialized Consumer Services company 1-800-FLOWERS (NASDAQ: FLWS) fell 2.9%. Is now the time to buy 1-800-FLOWERS? Access our full analysis report here, it’s free.
• Consumer Discretionary - Real Estate Services company Newmark (NASDAQ: NMRK) fell 4.5%. Is now the time to buy Newmark? Access our full analysis report here, it’s free.

Zooming In On Warner Music Group (WMG)

Warner Music Group’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 17 days ago when the stock gained 5.8% on the news that the company reported fourth-quarter 2025 earnings that showed strong revenue and profit growth, which overshadowed a miss on earnings per share. Investors focused on the positive aspects of the report, even though earnings of $0.33 per share did not meet forecasts. The company posted revenue of $1.84 billion, which beat analyst expectations and represented a 10.4% increase from the previous year. Furthermore, Warner Music showed improved profitability. A key measure, adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization), came in at $463 million, beating analyst estimates, while its operating margin expanded to 15.7% from 12.8% in the same quarter last year.

Warner Music Group is down 6.5% since the beginning of the year, and at $28.45 per share, it is trading 20.1% below its 52-week high of $35.59 from February 2025. Investors who bought $1,000 worth of Warner Music Group’s shares 5 years ago would now be looking at an investment worth $800.56.

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