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Apple Inc. shares are down more than 16% from their January highs, but an analyst argues that investors should take advantage of the decline to seize a “gold buy opportunity.”
Daniel Ives from Wedbush added Apple AAPL,
to his company’s “best ideas” list on Wednesday, writing that there is room for the company to positively surprise Wall Street with its iPhone results this fiscal year.
Apple shares edged down 0.2% on Wednesday morning. It has risen 69.4% over the past 12 months, while the Dow Jones Industrial Average DJIA,
increased by 28.6%.
Ives said concerns about cuts to this year’s iPhone forecast have put pressure on the stock lately, but he sees an opportunity on the upside. Although the FactSet consensus now calls for the sale of 224 million units of iPhones in this fiscal year, Ives argues that the company could sell more than 240 million given strong demand in Asia and a large base of iPhones around the world that are ripe for upgrades.
See also: Apple eclipses Samsung as top smartphone vendor for first time in four years, says Gartner
He wrote that average selling prices should benefit, as Apple appears to be successful in selling more expensive iPhone models like the iPhone 12 Pro and iPhone 12 Pro Max, while the iPhone 12 Mini is “considerably. reduced according to global production / demand ”.
Nikkei Asia reported on Wednesday that Apple is making dramatic cuts to its previous production plans for the iPhone 12 Mini from December, while making “relatively light” cuts on other iPhone models, in part. because some components and parts formerly intended for the Mini are transferred to the more expensive models.
The new production targets are still slightly higher than Apple’s shipments compared to the same period a year ago, the report says, while citing anonymous sources who said Apple’s cuts would come after the company could have been particularly aggressive with her goals months ago to make sure she would have done so. enough components at a time when some were scarce.
Apple did not immediately respond to a request for comment from MarketWatch.
Ives remains optimistic about Apple’s prospects for the iPhone, arguing that the “supercycle party” could continue with the iPhone 13 expected this fall given optimistic indications from the supply chain. He has “increased confidence that the iPhone 13 will have a 1 terabyte storage option, which is double the highest Pro storage capacity today,” suggesting that Apple may have more storage capacity. ‘price opportunities.
It has an outperformance rating and a target price of $ 175 on the stock.
Don’t Miss: Will 5G Ever Live Up to the Hype?
IDC analysts predict on Wednesday that global smartphone shipments could increase 5.5% in 2021, fueled by greater availability of 5G-enabled devices and “pent-up demand” for new phones. For 2020, IDC had calculated that smartphone shipments fell 5.9% from the previous year.
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