Julie Lamb

About the Author Julie Lamb

Julie graduated with a Bachelor of Arts in English with a focus on creative writing from the University of Louisville.

Apple Inc. (AAPL): Black Friday Buzz to a Future Booming OLED Fiesta

Analysts see a world wanting to each bite into Apple's bustling momentum.

Analysts across the Street are stewing on the Apple Inc. (NASDAQ:AAPL) tidal wave of impact set into motion with the new iPhone cycle- one that showcases the company’s first foray into organic light-emitting diode (OLED) technology for displays. Between major retailers driving traffic for Black Friday to a future ripple effect set to circle 2020 with a predicted OLED-based display explosion for the supply chain, everything’s coming up Apple.

Gene Munster – slicing and serving up insights from his research-driven, venture capital firm Loup Ventures – first takes notice of Black Friday, where leading retailers from the likes of Best Buy to Target to Walmart shrewdly utilized Apple products to rev up in-store as well as online traffic. The analyst highlights discounts found between 6% to 36% while also commenting Apple once again took to a year “sale” offering of 5% to 15% savings, just like this time last year’s Black Friday promo.

“Not surprising, retailers are taking a loss on many Apple products today and Monday (typically retailers have an average 15% margin on Apple products) to drive traffic and build brand,” writes Munster, who likewise comments that the iPhone X is “missing in action:” “While iPhone 8 is being discounted, we saw no discounting of iPhone X, which remains in tight supply.”

Of the retailers, Target is the “most aggressive” with a $250 iPhone 8 gift card that indicates a 31% average savings coupled with discounts from a 20% for the Watch Series 1 to a 17% deal for the iPad. The “second most aggressive” of the retailers goes to Best Buy, with an average 21% discount for the iPad while discounting all iPhones save for the iPhone X by 19%, the Apple Watch by 19%, and 11% on Apple Macs.

“Apple not surprising was third with an average ‘savings’ (gift card) on iPads of 12%, Watches of 10%, Macs of 9%, and iPhones (excluding iPhone X) of 7%. Walmart’s Black Friday Apple discounts were somewhere between confusing and misleading,” adds Munster.

Meanwhile, Munster concludes commenting on “Walmart’s mystery Apple deals,” asserting that while “at first glance, Walmart seemed to be most aggressive with Apple products on Black Friday,” after chatting with two Walmart stores for further information, Munster realized the $300 offer would apply “for only a fractional number of contracts that quickly got purchased Thanksgiving night,” which “feels misleading.” With iPhone 7 savings advertised to reach $49 that in actuality hit $49 above the retail price tag and an offer for $250 savings on an iPad Mini where “actual savings” would just be $50, Munster is left shaking his head. “Pull it together Walmart,” the research analyst chides.

Clearly, even with some false advertisers, these retailers recognize the power of the Apple train and all want to hop on it.

Jefferies analyst Chuljoong Kim approaches the tech empire from a supply chain standpoint, looking ahead to 2020 where he forecasts the company to have a new iPhone XI on the table in an S version carrying three sizes, with the largest likely a 6.5-inch display.

The analyst anticipates a booming supply chain benefiting from the tech titan’s first OLED-based display phone, all while acknowledging that other rivals have been using these tech moves long before Apple came to the OLED party. “Smartphone models featuring flexible OLED will likely increase sharply thanks to the positive market response to the iPhone X,” explains Kim, who also anticipates OLED-based screens to get bigger with the iPhone XIs Plus, the 6.5-inch mammoth set to take the industry by storm within the next few years.

OLED manufacturing will be put under hot water with other designers currently “experiencing production yield issues” with bigger displays likely translating to less completed “mother glass” OLED panels.

Therefore, Kim contends that “the OLED market is unlikely to see oversupply until 2019.”

Most analysts on the Street are rooting for the tech titan on the leaderboard, with TipRanks analytics exhibiting AAPL as a Strong Buy. Out of 31 analysts polled by TipRanks 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 $187.47, marking a 7% upside from where the stock is currently trading.  

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