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One investment firm is less enthusiastic about talk of a dire iPhone order cut and is instead bullish on the idea that orders across Apple’s supply chain are higher than expected.
iPhone 15 Pro Max — Apple’s current sales leader
As is customary every year, reports have emerged from China that it could be the worst year for iPhone sales. When supply chain estimates are done in the spring, they are always told that the estimated sales volume will be much lower than the investment firm had anticipated.
Morgan Stanley disagrees. In a memo to investors viewed by AppleInsider Eric Woodring noted that the company’s Greater China team has increased iPhone production numbers for the June quarter, which will partially include the fall iPhone 16 cycle.
The investment firm notes that Apple has had its worst start to the calendar year in a decade. At the same time, recent weeks have seen an upside of up to 5% over previous forecasts.
Woodring’s positive estimate comes from conversations with Foxconn. It also has a strong interest in selling older iPhone models in emerging markets and stability outside of China.
The note said sales in the March quarter may be better than expected, while the downside in the June quarter may be smaller than previously expected.
Despite this situation, the company has not changed its target price for Apple. It remains at $220.
Morgan Stanley believes prices could rise further as hardware subscription models emerge and headset and other product launches may expand more quickly. Potential risks to the price target include weaker-than-expected global spending and the possibility of tighter government regulation focused on the App Store.
Of course, other investment companies have different opinions. Wedbush is more bullish than Morgan Stanley, saying that while the next two quarters may be tough, Apple should return to growth in the September quarter.
Meanwhile, Loop Capital believes Apple’s overall revenue and earnings per share will decline in 2024 as iPhone sales continue to be weak throughout the year. If true, this would be the first time this has happened since 2016.
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