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Apple Inc. (AAPL): ‘Barometer’ of Suppliers Beat in November, Says Drexel

Brian White: Apple is better positioned than ever this holiday season.


Drexel Hamilton analyst Brian White today reiterates a Buy rating on shares of Apple Inc. (NASDAQ:AAPL), with a $235 price target, writing that sales in the month of November for a basket of companies he tracks in Asia in the supply chain — companies such as Hon Hai Precision Industry — which he collectively refers to as the “Apple Monitor,” were slightly better than typical seasonality.

Final November sales for the Apple Monitor rose by 7% MoM, slightly better than the average increase of 6% over the past twelve years. “Keep in mind, our Apple Monitor just delivered the strongest September quarter performance on record with five consecutive months of better than average seasonality before a weaker than average October performance. If we assume average seasonality for sales during the month of December, we estimate December quarter sales this year will increase by 18% QoQ and inline the average increase of 18% over the past twelve years,” White points out.

Furthermore, “This holiday season appears to be trending well thus far. Both the NRF and CTA provided upbeat updates around holiday spending after Black Friday and Cyber Monday. The NRF reiterated expectations for 3.6% to 4.0% growth in holiday sales this season compared to the up 3.6% last year. Also, the CTA indicated that “technology performed even better than expected over the Black Friday shopping week.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Brian White has a yearly average return of 12.8% and a 65% success rate. White has a 25.7% average return when recommending AAPL, and is ranked #147 out of 4721 analysts.

White is not the only fan of the iPhone maker on Wall Street, as TipRanks analytics exhibit AAPL as a Strong Buy. Based on 31 analysts polled in the last 3 months, 25 rate a Buy on Apple stock while 6 maintain a Hold. The 12-month average price target stands at $188.10, marking an 11% upside from where the stock is currently trading.