But analyst Chris Caso fears that Apple’s guidance for the September quarter will be more scarred by the pandemic than investors expect.
From TheFly, which snagged Caso’s note to clients:
Raymond James analyst Chris Caso raised the firm’s price target on Apple to $400 from $340 and keeps an Outperform rating on the shares ahead of the company’s Q3 earnings report. Caso calls attention to the fact that consensus September quarter estimates for Apple are too high given the late start for iPhone production this year, meaning it’s highly unlikely Apple will recognize any iPhone revenue in the September quarter, which isn’t reflected in the Street consensus.
Maintains Outperform rating, raises target to $400 from $340.
My take: $400 is the new $340.
UPDATE from Erik Savitz’ “Wall Street’s Sales Estimates for Apple’s September Quarter Look High, Analyst Warns” ($) posted Tuesday in Barron’s:
Raymond James analyst Chris Caso says that the Street’s September-quarter sales estimates are likely too high, given a later-than-expected start to iPhone 12 production due to the Covid-19 pandemic. In a research note Tuesday. Caso argues it is “highly unlikely” that Apple (ticker: AAPL) recognizes any revenue from the new phones in the September quarter.
“While we believe the later launch is well-understood by investors, it’s not reflected in Street consensus,” he writes. “This presents a dilemma for management in providing guidance, because they won’t be able to explain the reason for weak September guidance, since they don’t discuss upcoming launches.” Caso adds that his advice to Apple would be to simply decline to provide September guidance…
That said, Caso remains a bull on Apple shares, repeating his Outperform rating and lifting his price target on the stock to $400 from $340. He adds that while near-term estimates are likely to move lower, “investors will look to 2021, not 2020, to determine Apple’s normalized earnings power.”