Top Analysts Weigh in on Apple Inc. (AAPL) and BlackBerry Ltd (BBRY) Following Guidance Updates and CES Meetings


Top ranked analysts from Piper Jaffray and Canaccord weighed in on tech giants Apple Inc. (NASDAQ:AAPL) and BlackBerry Ltd (NASDAQ:BBRY) following estimate revisions and management CES talks, respectively. While one analyst remains bullish on Apple despite lowered iPhone guidance, another is cautious on Blackberry despite recent positive developments, predicting future challenges.

Apple Inc.

Analyst Gene Munster of Piper Jaffray recently weighed in on Apple, commenting on March quarter iPhone estimates. He states that although the company remains his firm’s top pick for 2016, he is lowering his March iPhone expectations due to reported lower iPhone component production from suppliers as well as his own checks. As a result, he is also reducing his revenue expectations for the upcoming quarter. However, he states that the recent drop in share price “already reflects low expectations for iPhone units in March.”

Because “AAPL traded around 9x forward EPS ex-cash” in January of 2014, the middle of the iPhone 5s product cycle, the analyst believes shares will turn around after the upcoming earnings report “once the uncertainty around March iPhones is removed from the story,” as the iPhone 6s is currently in its middle product cycle. He states that guidance as low as 45-50 million iPhones for the March quarter, compared to his firm’s previous guidance of 62.5 million, “would likely be a relief for shares.”

Although Apple previously stated that supply chain component orders do not affect “the health of the iPhone business overall,” the analyst believes recent lowered guidance estimates from 3 key suppliers and a similar report from Nikkei, the Japanese exchange, are “too much collective evidence to not adjust iPhone expectations. Despite lowered estimates, the analyst reiterated his overweight rating with a $179 price target.

Gene Munster is ranked #6 out of 3,682 analysts on TipRanks. He has a 60% success rate recommending stocks with a yearly average return of 19.1%.

Gene Munster Consensus

BlackBerry Ltd

Analyst Michael Walkley from Canaccord weighed in on Blackberry following an investor meeting with CEO at the CES last week. The analyst stated a few positive highlights from the meeting and the CES in general, although he remains cautious. The analyst commented on the company’s QNX automotive software, expressing positive sentiment regarding its market share and believes WNX “remains a strong long-term software growth driver for Blackberry.” Other reasons for bullishness include QNX’s involvement in the internet of things long-term growth as well as the company’s presentation of other products for the autonomous driving market.

He continues by stating that Blackberry’s PRIV, released in November, will result in “higher device ASP’s” although does not predict a surge in sales due to competition from Android and “uncertain market demand” for the niche product. Walkley also comments on the company’s recent strong earnings, stating that he expects “another strong quarter of software sales growth with a full quarter of the Good and Athoc acquisitions.”

However, the analyst is not so quick to jump on the bullish bandwagon.   He believes that going forward, the company “faces a challenging road of ramping organic software growth to meaningfully replace the services decline over the next several years.” Walkley states that through FY2018, “the continued steep decline in high margin services business and ongoing tepid hardware sales will remain a headwind to meaningful profitability.” The analyst maintains his Hold rating on Blackberry with an $8 price target.

Overall, analyst Michael Walkley has a 58% success rate recommending stocks with a 13.3% average return per recommendation.

Michael Walkley Consensus

 

  • DEVVVV

    BlackBerry continues to focus on physical keyboard type device that caused their demise pertaining to the all touch devices. So has BlackBerry’s focus change, you may ask,, No.

    • Smart Investor

      Why YES, in fact they do!! Blackberry installed their second to none, no close second, security features on top of the most popular o/s in the world via their Android-based Priv (Android = 84% smartphone marketshare vs. Apple’s 14%), Blackberry now has every app that is available in the world, they are now solid with Google Search, Maps, Tracking, Pay etc.). The Priv has an optional keyboard that slides out as a keyboard or phone holder (allows users to view entire screen)……And at C/E/S, Mr. Chen said many more Android based o/s phones with Blackberrys unmatched security are in the works. So yes, their focus has changed by 100%…… What does Apple have? The Walmart of non-innovative phones (no, resizing doesn’t count as innovation) that every garbage man, barista and little girl own. I would take the BlackBerry Priv ANY day over the old, antiquated, constantly resized iPhone. I have the S6 Samasung.

      • DEVVVV

        Smart In… The only thing Chen proved is he lost faith in BB10 and is the reason why they switched to Android. This leads me to believe and apparently the majority of investors, that Chen is not capable of producing likeable software solutions.

        • KT Watkins

          Chen wasn’t the one who went down the BB10 path, his predecessors did and he made a decision to diversify the software his hardware runs on. The BB10 software from a mobile standpoint just didn’t have enough traction to support selling hardware phones and if no other companies were willing to use BB10 then why continue to support it?

          • DEVVVV

            BB10 wasn’t the problem its Chen’s device design. The majority of peoples minds are made up just by viewing through the smartphone showcase glass. Chen continued to go with the horrible design of the Passport. Then when Chen was pondering the idea of a slider phone, it was at that point he was not the one. I have sat at a retailer of smartphones and when noticing someone looking I ask them questions. I ask what kind of OS do you like? They reply either what is that or say I like one that works in the background, but my most concern is if I like the device itself.

        • Smart Investor

          Look, I am not a Blackberry fan relative to stocks. Hell, it’s probably a good short today at sub-$7.00. However, you stated, “So has BlackBerry’s focus change, you may ask,, No.” That is categorically incorrect. They have changed everything. Platforms to support all devices, diving into IofT’s…….Android phones. I would ask, What’s the same about Blackberry this year when compared to 2014 or even 2015. I would be shocked to see BB10 in 2017…..All Androids with their super secure mix. Truth is, it’s probably a great phone. I know I will look at it when I feel the need to upgrade (2 or 3 years from now) – but it is CERTAINLY a good option. As far as the stock??? STAY AWAY….let the numbers, if they ever go positive, get you back in. Same with Apple. STAY AWAY. Their field day of their ONE product that matters may have had its better days….behind them. That’s NOT good for the stock…..and down 35% so far since the last “iphone-resizing-event” is not a huge vote of confidence.

          • DEVVVV

            I was talking about Chen, Thorsten already was in the works of doing what you said. If Chen would have entered the company and said first things first ” get that ugly Passport out of my sight” secondly lets not bring up the past ” the slider device” and thirdly not doing all he can by leaving no rock unturned in the hope that someone may have a idea pertaining to a turnaround. Sorry Chen has stated in a statement ” NO stardom please” at that point my point of Chen not being the one was verified.

    • It’s no longer a hardware focused company, but rather software/services based company. That is a complete 180 in terms of changing their focus.

      • DEVVVV

        Re:”It’s no longer a hardware focused company,” that is because they dont know how. Now that Chen has somewhat lost faith in BB10 Os software, it appears he lost confidence in building software altogether I believe, or at least it appears investors think he did.

        • You can’t even speak with intelligence about the Software side of the company so your comments are wasted.

          • DEVVVV

            HBB I learned to read and write on this PC. My mind was not corrupted by society’s way of education. If given the opportunity I could make BlackBerry’s enterprise solutions 100% better and easier to use. If BlackBerry doesn’t find interest in this, or at least curious, or seeking anyway to make this company work, it is not worth investing in. If Chen does not investigate all means of a turnaround, he should be ousted.

          • Sure thing…

          • Thrilla Milla

            Your hired. Show up at the Waterloo office on Monday. Don’t forget my coffee.

          • DEVVVV

            Too bad your name is not Chen, as it would be the best move he ever made. Thrilla if BlackBerry was to announce they are giving this crazed eccentric poster a chance, just in the event I am correct, share price would triple just on the hype alone. What do you take in your coffee? lol

          • lol, I guess you didn’t notice he’s actually making fun of you by saying that…

          • Did you hear that your beloved Cannacord gave BBRY a Buy Rating? Obviously they know something you clearly don’t as they don’t share the same opinion as you any more…