Apple Inc. shares are more than 16% lower than their January highs, but one analyst argues that investors should take advantage of the decline to seize a ‘golden buying opportunity’.
Wedbush’s Daniel Ives added Apple AAPL,
wrote on the list of his company’s best ideas on Wednesday and wrote that there is room for the company to positively surprise Wall Street with its iPhone results this financial year.
Apple’s share rose 0.2% on Wednesday morning. It has risen 69.4% over the past 12 months, while the Dow Jones Industrial DJIA,
increased by 28.6%.
Ives said concerns about cutting this year’s iPhone forecasts have put the stock under pressure lately, but he sees opportunity for upside. Although the FactSet consensus now calls for 224 million iPhone units to be sold in the financial year, Ives claims the company could sell more than 240 million, given strong demand in Asia and a large number of iPhones worldwide that are ripe for upgrades.
See also: Apple marks Samsung for best smartphone sales for the first time in four years, says Gartner
He wrote that average selling prices would benefit from it, as it looks like Apple could sell more expensive iPhone models such as the iPhone 12 Pro and iPhone 12 Pro Max, while the iPhone 12 Mini is ‘significantly scaled down around production / demand worldwide’.
Nikkei Asia reported on Wednesday that Apple had made drastic cuts to its iPhone 12 Mini production plans since December, while making “relatively soft” cuts to other iPhone models, in part because some components and parts previously intended for the Mini, transferred to the more expensive models.
The new production targets are still slightly higher than Apple’s shipments in the same period a year ago, the report reads, citing some unnamed sources who said Apple’s cuts came after the company was particularly aggressive with its targets months ago. . enough components at a time when some had deficiencies.
Apple did not immediately respond to a request for comment from MarketWatch.
Ives remains optimistic about Apple’s iPhone prospects, arguing that the ‘superbike party’ could continue with the iPhone 13 expected in the fall, given optimistic indications in the supply chain. He had ‘greater confidence that iPhone 13 has a 1 terabyte storage option, which is double the highest Pro storage capacity today’, suggesting that Apple may have more pricing opportunities.
He has a better performance rating and a price target of $ 175 on the stock.
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IDC analysts forecast on Wednesday that overall smartphone shipments could increase by 5.5% in 2021, fueled by greater availability of 5G-enabled devices and a pent-up demand for new phones. For 2020, IDC calculated that smartphone shipments fell by 5.9% year-on-year.