A sign, says Apple bear Aaron Rakers, that iPhone unit sales may disappoint.
In a cryptic note to clients that landed in my inbox Tuesday, Stifel analyst Aaron Rakers spots what he thinks may be a troublesome sign.
In the quarter that just ended the combined revenue of Hon Hai (Foxconn) and Pegatron—the Asian manufacturing giants that assemble, among other devices, all of Apple’s iPhones—was down 4% year over year. He writes:
As we have highlighted in the past, Hon Hai + Pegatron revenue have a high historical correlation to Apple’s product (ex-service) revenue… Our analysis continues to leave us estimating iPhone shipments in the low-70M range, relative to our 76.7M estimate for the December quarter (Street: 77.4M).
In the chart below, Apple iPhone Shipments for calendar Q4 2016 is Rakers’ estimate. How he can offer estimates in both the low 70 millions and the high 70 millions is not clear.
Click to enlarge. Not seeing the chart? Try the website.
Rakers maintains a hold on Apple. In October he lowered his price target to $115 from $130.