Microsoft's TikTok acquisition could be worth $200 billion in 3 years if deal goes through, Wall Street analyst says (MSFT)

Reuters

• Dan Ives of Wedbush Securities told CNBC that a TikTok acquisition could be worth $200 billion in three years for Microsoft, if the deal goes through.
• Ives said Microsoft is the "white knight" to buy TikTok following Trump's Monday announcement that the app must be sold by September 15.
• The analyst said a TikTok acquisition would give Microsoft a "major play in social media."
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Dan Ives, managing director and senior equity research analyst at Wedbush Securities, told CNBC on Monday that a TikTok acquisition could add $200 billion to Microsoft's market capitalization in three years,  if the deal goes through.

Ives said he thinks there's a 75% to 80% chance the deal happens, and added that estimate "could be conservative."

President Trump said on Monday that TikTok will be out of business in the US if it's not sold by September 15. Ives said that Microsoft is "the only white knight here" to buy TikTok, as all of the FAANG "tech stalwarts" are "basically caught in regulatory swirls," while Microsoft is not. 

Ives added that Microsoft does not currently have a social media platform besides LinkedIn, so "there are no antitrust or regulatory issues." "Right now the leverage is with Microsoft," the analyst said. 

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Ives said that a TikTok acquisition would give Microsoft a "major play in social media." In the quarter that ended on March 31, TikTok was downloaded 315 million times, according to TechCrunch. That's the highest number of downloads for any app in a quarter. 

The Wedbush Securities analyst holds an outperform rating and a $260 price target for Microsoft. Ives increased the target from $220 on July 9.

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