Stifel hoists Apple target 15%

From a note to clients by Stifel analyst Aaron Rakers that landed in my inbox Wednesday night:

90M+ iPhone Ship Upside in Dec ’17 Quarter?

With the clear focus being on the upcoming iPhone 8 cycle, in this report we provide an iPhone ship summary based on using our iPhone active installed base estimates (we currently estimate 730M) historical shipment trends and the initial ramp of next-gen iPhone shipments over the following four quarters – leaving us particularly focused on the potential upside set-up into the Dec ’17 quarter (albeit Apple’s product cycle velocity attributes should be considered).

For example, we est. that the newest gen iPhone shipments (upgraders + new iPhone subs) accounted for 13%, 12%, and 8% of Apple’s pre-cycle installed base in 2014, 2015, and 2016 – using IDC’s iPhone ship estimates.

The next-gen iPhones also equated to 70%, 72%, and ~67% of Apple’s total iPhones shipped in these December quarters.

In the send-able model below we show that an 11% ship-to-installed base level and a ~70% new iPhone contribution to total ship would leave us to consider a 90M+ total iPhone ship level into the Dec ’17 quarter (vs. our updated 84.8M estimate; Street: 82M).

Reiterate Hold (!), raise price target to $150 from $130. 

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4 Comments

  1. Steifel downgraded to hold when stock was at $115. Reiterated hold six months later when price was at $140 while expecting price to go to $150 and sales to hit record highs. Consistency.

    1
    April 20, 2017
  2. Robert Paul Leitao said:

    A possible 90 million unit shipment quarter and the firm has a hold recommendation and a $150 price target? It’s not just the iPhones that matter. I expect a pick-up in Services and Other Products (accessories) revenue along with high volume iPhone sales.

    0
    April 21, 2017
  3. Jonny Tilney said:

    I wonder whether there is any other website/blog/journalist who works as PED does to expose the effectiveness of analysts?

    0
    April 21, 2017

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