Apple Inc. shares fell more than 16% from January highs, but an analyst argues that investors should take advantage of the fall to take advantage of a “gold buying opportunity”.
Daniel Ives de 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 fell 0.2% in Wednesday morning trading. It has risen 69.4% in the last 12 months, while the Dow Jones Industrial Average DJIA,
advanced 28.6%.
Ives said concerns about cuts to this year’s iPhone forecast have put pressure on stocks lately, but he sees an upside opportunity. Although the FactSet consensus now calls for the sale of 224 million iPhone units this fiscal year, Ives argues that the company could sell more than 240 million due to strong demand in Asia and a large base of iPhones globally ready for updates.
See also: Apple surpasses Samsung as the main smartphone supplier for the first time in four years, says Gartner
He wrote that average selling prices should benefit, as Apple appears to be succeeding in selling more expensive iPhone models, such as the iPhone 12 Pro and iPhone 12 Pro Max, while the iPhone 12 Mini is being ” significantly reduced in relation to global production / demand “.
Nikkei Asia reported on Wednesday that Apple was making dramatic cuts to its previous iPhone 12 Mini production plans as of December, while making “comparatively smooth” cuts on other iPhone models, in part because some components and parts previously intended for the Mini are being transferred to the more expensive models.
The new production targets are still slightly above Apple’s sales for the same period last year, the report said, citing some unidentified sources who said Apple’s cuts came after the company may have been especially aggressive with its month-long targets. ago to ensure it would have enough components at a time when some were at fault.
Apple did not immediately respond to a request for comment from MarketWatch.
Ives remains optimistic about the prospects for Apple’s iPhone, arguing that the “super cycle party” may continue with the iPhone 13 due in the fall, given optimistic supply chain indications. He “increased confidence that the iPhone 13 will have a 1 terabyte storage option, which is double the current largest Pro storage capacity,” suggesting that Apple could have more pricing opportunities.
It has a superior performance rating and a $ 175 share price target.
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IDC analysts forecast on Wednesday that overall smartphone shipments could increase 5.5% in 2021, driven by greater availability of 5G-enabled devices and “pent-up demand” for new phones. For 2020, IDC calculated that smartphone shipments fell 5.9% over the previous year.