Aaron Rakers charts the Chinese tea leaves all the Apple analysts have been reading.
From a note to clients that landed on my desktop Saturday:
Late this week China exports for the month of March were published, in which total mobile phone (wireless handset) exports declined 8% y/y, but increased 46% m/m. For total 1Q19, exports declined 19% y/y and 43.5% q/q (vs. 5-year average 1Q seq. decline of 36%; -33% q/q in 1Q18). This compares to a 4% y/y decline in exports during the December quarter.
As shown below, we have found a high historical correlation with Apple’s iPhone shipments, excluding China. If we were to apply this historical correlation for 1Q19, we would be left to estimate implied iPhone shipment (ex-China) to decline in the mid-to-high 20% range y/y, or implying the low- 30 million range. Coupled with our below analysis of internal China, we would be left to estimate C1Q19 iPhone ship in the high-30M to 40M range vs. our estimate of ~44M units (street: 43M units).
Cue the charts:
Click to enlarge.
Maintains Market Perform rating and $160 price target ($40 under water).
My take: Still counting iPhone units.