With Apple hovering between $207 and $209, Bernstein's 12-month price target is stuck at $190.
From a note to clients sent last week that landed on my desktop today:
Historically, Apple's fiscal Q3 results have meant relatively little to investors, whose focus by this time had typically shifted to next year's iPhone cycle – with anticipation driving seasonal outperformance in the stock. Following Apple's volatile 2019, however, we'd argue that Q3 results will likely matter more than usual, as they could shed further light on (1) the iPhone's health in China; (2) price elasticity of iPhone sales, given recent price cuts in emerging markets; and /or (3) any contraction or further elongation of iPhone replacement cycles...
Looking forward, we note the outlook for FY20 is arguably more uncertain than in prior years, given that Apple will be launching several major new Services, questions about the trajectory of replacement cycles remain, & rumors about next year's iPhones appear less than definitive. While all eyes this quarter will likely be on Apple's FQ4 guidance, we note that this guidance has historically *not* been a helpful predictor of strength in the subsequent year's cycle. We expect Apple to guide to FQ4 revenues of $60-$62B and gross margins of 37 – 38%.
Maintains Market-Perform rating and $190 price target.
My take: For reasons I can't discern, Sacconaghi has been wrong on Apple for nearly as long as I remember. But you never know what's around the corner.
See also: Cramer: Huberty vs. Sacconaghi (video)