Time for Apple analysts to panic

From Bill Maurer’s iPhone Panic Sets In, posted Friday on Seeking Alpha:

apple analysts panicIn the end, it’s again time for Apple analysts to panic as we approach the company’s earnings report. We’ve seen this time and time again, and this quarter, the iPhone X seems to be the main culprit, but I also think a lack of SE refresh and the battery replacement program are hurting. Investors will likely brush off some softness, thanks to the capital return program update, but don’t ignore what happened at last quarter’s report when guidance was weak. Shares have already dropped a bit late this week, but they could go lower still if we get more and more negative commentary in the next few weeks.

My take: Maurer, who is one Seeking Alpha’s better Apple analysts, includes an impressive list of recent negative Apple headlines from StreetInsider:

Panic
Click to enlarge. Click here for the original.

The upside of a down week in April is that lowered expectations are easier to beat in May.

9 Comments

  1. Fred Stein said:
    We’ve seen this movie. Last time it was the return to earth the year after the rocket ride when Apple launched the “6” and opened up China in the same year.

    Now folks are OMG’ing about the possible fall off in demand for the X. Perhaps price is a factor. The 7’s and 8’s are great phones, especially the plus models with telephoto All the 7 and 8 models are considerably cheaper and have been available for quite some time.

    But so what? AAPL trades 10% below a fair price based on flat revenue. Even assuming flat revenue, buybacks increase EPS by at least 5% annually.

    1
    April 20, 2018
    • Gregg Thurman said:
      AAPL only returned to “earth” when the follow-on didn’t result in the same kind of explosive growth as the iPhone 6 year did.

      The reality is (learned in hindsight) that worldwide handset growth flattened in 2016, and has been flat since.

      FY2014 iPhone unit sales 169,219,000
      FY2015 iPhone unit sales 231,218,000
      FY2016 iPhone unit sales 211,884,000
      FY2017 iPhone unit sales 216,756,000
      FY2018 (est) iPhone unit sales 217,987,000

      From FY2010 through FY2013 YoY unit growth averaged 66.7%. That dropped to 12.6% for FY2014 (iPhone 5S). iPhone 6 increased YoY growth to 36.6%.

      Including this year’s unit sales estimate YoY (FY2014 – FY2018) Omitting FY2015,unit growth has leveled off at 1.83% (range -8.36% to 12.6%).

      In light of this multi-year trend how in the hell did WS come up with its exaggerated “consensus” estimate, that is now being lowered because of “problems with Apple’s ability to perform”?

      There’s a world of amateur analysts that I believe are infinitely better than WS “pros”.

      Even with wacked out estimates on the high and low end, Estimize.com’s bevy of amateurs (about 700) come closer to Apple’s revenue and EPS estimates than does WS “pros” (about 70% of the time).

      0
      April 20, 2018
    • Gregg Thurman said:
      “Now folks are OMG’ing about the possible fall-off in demand for the X. Perhaps price is a factor.”

      BTIG Research’s Walter Piecyk, reports today that research shows, from iPhone X launch through March, iPhone unit mix has been on a continuous trend favoring the base iPhone X. He estimates March quarter iPhone ASP at $745. I’m at $753.

      2
      April 20, 2018
  2. Patrick Beyrouti said:
    @Gregg, finally some one ( or 2) . talking about ASP, yes ASP will be 15% higher YoY. This is the best strategy for Apple while worldwide demand for handsets is flattening.
    expect good news on May 1st and a confirmation of better ASPs going forward.
    As cheaper models are retired and more phones offered at $999++ ASP will continue to push up!!

    @Phil, have been writing about volume being irrelevant for iPhone now, only makes sense if your table includes the assumed ASP for each analyst .

    0
    April 20, 2018

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