With Apple near $350, Goldman Sachs sticks with $243 target

But analyst Rod (“sell Apple) Hall sees an upside in Cupertino’s edge in online smartphone sales.

From a note to clients that landed on my desktop Sunday:

Q1 total handset shipments at 340m missed our estimate by 8% and declined 21% Y/Y. Non-Apple OEMs declined 23% Y/Y, while Apple units declined only 8% Y/Y. Optically, this implies ~1.7pp global share gain for Apple in Q1, according to the Gartner data.

We believe Apple’s outperformance was a result of other OEMs struggling to shift to online channels amid Global lockdowns while Apple’s online presence is stronger. According to IDC, 17% of iPhone shipments were through online channels in Q1’20, a ~6pp improvement Y/Y. This compares to just 2pp Y/Y improvement in online sales for other OEMs. We expect Apple to continue to outperform the market in the near term due to this online phenomenon though we would expect some normalization as other OEMs adapt by the end of this year.

Better performance of Apple helped overall handset market ASPs. Handset market ASPs grew 5% Y/Y to $263, according to IDC. Parsing through the data, we observe that better market share performance at Apple helped to drive growth in market ASPs. Excluding Apple, Market ASPs grew only 1% Y/Y. (see Exhibit 8 for an overview of handset market ASP trends).

…and mix was also better within Apple. Latest generation iPhones (launched the previous fall) made up 69% of total iPhones shipments in Q1’20, up from 55% in Q1’19, according to the IDC data. This better mix within iPhones drove overall iPhone ASP up 2% Y/Y in Q1’20, according to IDC (see Exhibit 5 for iPhone mix and ASPs). We note that the better iPhone mix this year is consistent with our thinking that higher end consumers may have accelerated spending due to lockdowns and the perceived lack of job risk. We expect this to change if white collar job losses accelerate in H2.

Below: Exhibit 5…

Click to enlarge.

Maintains Sell rating and $243 price target. 

My take: Hall, who set his current (Street-low) price target on May 1, is overdue for an upgrade. Maybe later today?


  1. Romeo A Esparrago Jr said:
    PED: “Maybe later today?”

    We’ll see. So much commentary on Rod Hall in the past postings here about his price targets and what he says. Willful, ignorant, agenda, clueless, maybe really smart/prophetic, maybe not, etc – what’s he on about?

    I’m reminded of the Oct 2, 2019 post from JT’s Digs about Mr. Hall.


    June 22, 2020
    • Ralph McDarmont said:
      Maybe a crook, I don’t know about that. But certainly a fool.

      June 22, 2020
      • David Emery said:
        When you have a track record of being wrong as long as Hall’s, and you work in a profession that is all about data analysis, either you’re completely deaf and dumb and stupid, or you’re a crook.

        The fact that sometimes he has meaningful things to say argues against the “deaf, dumb and stupid’ hypothesis. It’s much more likely at this point the actions are deliberate, which makes him a crook. QED. 🙂

        June 22, 2020
  2. Mordechai Beizer said:
    At what point does it become clear to his employer and to Goldman’s clients that Rod is not a very good Apple analyst? If your job is to provide guidance how many whiffs at bat are acceptable?

    June 22, 2020
    • Thomas Larkin said:
      That he hasn’t been fired may be evidence that he’s crooked and his employer knows it, perhaps (IMHO)?

      June 22, 2020
  3. Jerry Doyle said:
    Meanwhile, Apple just keeps climbing to all-time new highs. Apple is up $5.11 to $354.82 as I write this comment. What is it about Apple Rod Hall fails to grasp and why do his clients follow his advice?

    June 22, 2020
  4. Aaron Belich said:
    Rod is simply providing some documentation for his company to profit on the brokering of Apple stock.

    As a market analyst he can be wrong, GS makes money on the trades regardless. He’s a bait and switch for the organization as a whole. Gets airtime on the networks for the crap he says, but internally GS is making money hand over foot facilitating the movement of the stock.

    I mean, they have to be. There can be no other explanation.

    June 22, 2020

Leave a Reply