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Apple Inc. (NASDAQ: AAPL) announced a new iPhone iteration, among other products, at its fall event on Tuesday. Apple stocks, however, haven’t benefited much from the product unveiling.
Here’s what sellers have to say.
The key to sustainability in the second year of the 5G era, says Credit Suisse: The launch event went largely according to expectations, bringing more gradual changes to the lineup, Credit Suisse analyst Matthew Cabral said. This contrasts with the staged improvement in function seen last year with the addition of 5G, the analyst said.
Aggressive promotions by carriers outside the gate remain a potential swing factor to help boost demand, he said.
“More broadly, sustainability remains a key debate for the title as we enter year 2 of the 5G era.”
History suggests a significant slowdown in the second year of the major cycles, Cabral said.
The analyst sees the unit’s momentum wane as last year’s pent-up demand from more tech-savvy early adopters gives way to a more traditional buyer base focused on a standardized replacement cycle.
Additionally, ASPs could potentially tip into a headwind as the more widespread adoption of 5G pushes the mix off after the disproportionate strength of last year’s Pro / Pro Max, Cabral said.
Related Link: Why Apple is a ‘High Tech Name’ to Own Right Now
Why Morgan Stanley expects higher ASPs, a unitary promotion-induced force: From a feature set and pricing perspective, the launch event was as expected, Morgan Stanley analyst Katy Huberty said.
Some of the surprises include a 1TB iPhone model and new iPads, the analyst said.
Despite the iPhone’s prices being relatively unchanged from the iPhone 12, the introduction of high-end iPhone storage benchmarks is likely to boost Phone ASP’s year-over-year growth, he said. she declared.
At the same time, the iPhone’s higher trade-in values and more aggressive carrier promotions make the iPhone 13 more affordable for consumers, Huberty said.
“Combined with iPhone replacement cycles that remain elongated, 5% adoption of 5G within the iPhone installed base, fully reopened retail stores and a high backlog of incoming iPhones. FY22, we remain optimistic about the iPhone’s growth prospects during FY22. ”
Analyst sees upside potential over Morgan Stanley’s iPhone ASP forecast.
If the first demand trend reports point to high demand for the iPhone compared to low buying expectations, Apple stocks will likely outperform in the near term, according to Morgan Stanley.
Key takeaways from Needham at the Apple launch event: Apple is focusing on the interdependence of its ecosystem between new use cases and hardware upgrades, said Laura Martin, analyst at Needham.
The company’s marketing strategy appears to be the use of enhanced hardware features to target and collect new, passionate niche audiences through software, the analyst said.
Apple expands its “prime tenant” use cases to attract new, long-term loyal customers to its ecosystem, and then sells them other products and services, she said.
“As many AAPL services are way ahead of their competition, it is difficult for these fandoms to leave the iPhone ecosystem.”
Apple’s bundle of integrated products and services are among the most economically profitable, and the focus on collecting global fandoms reduces churn, lowers customer acquisition costs, and increases power. printing, said Martin.
RayJay optimistic about Apple’s units, mix up: The most important takeaway from the event is that subsidies to US carriers appear even more aggressive than last year, prompting growing optimism about the units and the mix, said Chris Caso, analyst at Raymond James. .
The analyst said the main incremental features of this generation of iPhone were longer battery life and improved cameras – features that resonated the most with consumers.
Memory loading was increased for the low-end iPhone 13 and 13 Mini models, although high-end memory loading remained unchanged, he said.
The next big event will be to monitor pre-order sales and product availability, Caso said. Pre-orders begin this Friday, and all models are expected to be available on September 24, according to RayJay.
Related Link: Apple Showcases Big Plans for Apple TV +, Including Netflix, Disney +, and Amazon Prime
Apple Notes, Price Targets: Credit Suisse has a neutral rating and a price target of $ 150 for Apple shares.
Morgan Stanley maintained an overweight rating and a price target of $ 168.
Needham assesses Apple shares a purchase price target of $ 170.
RayJay maintained an outperformance rating and a price target of $ 168.
AAPL price action: Apple shares gained 0.61% on Wednesday, closing at $ 149.03.
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