Wedbush: iPhone 12 launch gaining steam

"We have not seen a launch uptrend such as this in a number of years for Apple... the only iPhone trajectory similar would be the iPhone 6 in 2014." — Analyst Daniel Ives

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

With Apple launching its highly anticipated iPhone 12 5G lineup of smartphones last week, our Wedbush TMT team has been conducting our Asia supply chain checks over the last few days to gauge demand trends. The initial reads are very bullish and give us incremental confidence in our supercycle thesis on iPhone 12. We now believe the supply chain is anticipating 80 million iPhone 12's for the initial launch period with potentially a stretch goal in the mid 80's for units. To put this in context, heading into last week we were anticipating 75 million units as the line in the sand and roughly a month ago this number was in the 65 million to 70 million range. We have not seen a launch uptrend such as this in a number of years for Apple and the only iPhone trajectory similar would be the iPhone 6 in 2014 based on our analysis.

Maintains Outperform rating and (Street-high) $150 price target.

My take: These launch estimates have become convention wisdom.

6 Comments

  1. Fred Stein said:
    Hello market.

    Can’t you hear that whistle scream, the mighty engines roar?

    2
    October 20, 2020
  2. Jerry Doyle said:
    @ Brother Fred Stein: I do not believe the markets truly are listening to Apple now. The markets are too preoccupied with other conspicuous matters. There have been a multiplicity of reports filed where legitimate supply chain monitors report significant uptrend in the iPhone 12 launch compared with recent annual launches as far back as the iPhone 6, the last similar uptrend seemingly commensurate with the current iPhone 12.

    I suspect that once we have the earnings call at the end of the month and once the election is behind us then we are going to see Apple start a climb in stock price to $150 by the end of Q2 2021 when Tim & Luca report earnings for that period, if we don’t see $150 before they report Q2 results.

    2
    October 20, 2020
  3. Gregg Thurman said:
    The markets are waiting for official confirmation (earnings and guidance) that Apple is performing as expected (or even better) before it opens its wallet for AAPL.

    I know this because that is what I am doing.

    2
    October 20, 2020
    • Aaron Belich said:
      In agreement with Greg on this.

      Sure this year might be seeing a big boost from iPhone X owners who brought a boost to Apple that many a talking head were oblivious to, many of whom were upgrading from 6+. Or all of these analysts are boosting the numbers to pump the stock and “sell/exploit the news” to sell and sell hard, then scoop up more shares at the low in some heavy options trading 3/6/9 months out as the stock inevitably recovers.

      It’s happened before, it’ll happen again.

      And a reminder, there will never be a supercycle like iPhone 6/6+ as there are no massively untapped markets suddenly being entered into plus a new form factor. India still isn’t ready for prime time from why I’ve seen.

      0
      October 20, 2020
  4. Bart Yee said:
    IMO, Apple should remain mum and optimistically vague about preorder sales or records. Just say:
    “We’re gratified by the overwhelming response from our customers.”

    Recycled response from 2016 iPhone SE intro modded for today:

    “We’re working hard to get the iPhone 12’s into the hands of every customer who wants one, as quickly as possible,” Cook said on the call.

    Let All the analysts provide free publicity for the huge demand for iPhone 12s.

    0
    October 20, 2020
    • Bart Yee said:
      I believe Apple should again not provide guidance for FY Q1 2021 because of multiple uncertainties regarding repeated Store closures, slow and fitful economic restarts in several geographic markets, major Covid concerns on new waves coming this fall and winter, and the geopolitical issues revolving around the US election.

      Let the financial analysts twist some more in the wind and give us their estimates. Meanwhile Apple keeps doing what they do best, aspire to be the best and let the financial results and rewards become self evident.

      0
      October 21, 2020

Leave a Reply