Apple Inc. (NASDAQ:AAPL) suffered some weakness yesterday on the heels of negative media buzz circling word from the United Daily News that the tech titan would be chopping its supply chain orders in two for the months of November and December for the iPhone 8/8 Plus.
What should shareholders make of the “gloom and doom ahead of the iPhone X?” Invest into it, wagers Drexel Hamilton analyst Brian White, who delivers a strategy for the bulls: “We would be aggressive buyers of the stock with the iPhone X cycle kicking off next Friday with pre-orders.”
Following whispers of watered down supply chain orders running amiss, the analyst reiterates a Buy rating on AAPL stock with a $208 price target, which represents a just under 33% increase from current levels. (To watch White’s track record, click here)
White explains, “Given the staggered launch during this cycle with the iPhone 8/8 Plus becoming available for pre-order on September 15 and the iPhone X on October 27, we believe this is causing more confusing data points relative to past cycles. Even during some of the best iPhone cycles, Apple cuts forecasts.”
Keep in mind that White’s Apple Monitor sales, an index which tracks sales of nine ‘important’ publicly-traded Apple suppliers based in Taiwan, saw a 49% quarterly surge in the third quarter, a far improvement from the usual 20% climb for a September quarter when looking at the last 12 years. To the analyst, his Apple Monitor experiencing “the strongest September quarter performance in its history” further exhibits Apple’s level of intense preparation for the launch of its 10th anniversary model of the first iPhone.
Overall, “There are many moving pieces to this iPhone cycle that should not be overlooked. For example, most of the people that we speak to in the U.S., and a common theme during our China Tech Tour, is that consumers are waiting on the iPhone X. Moreover, we believe the iPhone 7/7 Plus is benefitting from incremental demand as consumers can take advantage of the recent price cuts in light of the iPhone 8/8 Plus introduction,” White contends, confident as ever ahead of the titan’s iPhone X cycle.
Drexel Hamilton’s White is not the only analyst trumpeting this tech leader’s praises, considering TipRanks analytics showcase AAPL as a Strong Buy. Based on 29 analysts polled by TipRanks in the last 3 months, 22 rate a Buy on Apple stock while 7 maintain a Hold. The 12-month average price target stands at $176.61, marking a 13% upside from where the stock is currently trading.