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There's No Evidence iPhone Orders Have Been Cut: JPMorgan

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Apple Inc. NASDAQ:AAPL - There's No Evidence iPhone Orders Have Been Cut: JPMorgan

Apple Inc. AAPL 1.1% iPhone build plans seem to have remained stable since early March. JPMogran’s Rod Hall maintained an Overweight rating for the company, with a price target of $141, saying that there was no evidence of order cuts, and iPhone SE was the main focus of FQ216.

There seems to be no evidence that iPhone orders for the June quarter have been reduced, and the quarter’s iPhone build plans appear to have remained stable at around 43-45m units since March, analyst Rod Hall said. He added, “We note that, if correct, these build orders continue to indicate flat shipments Q/Q in FQ3’16.”

Earthquake Disruption

The earthquake that hit South Japan on April 20 impacted a key Sony camera module facility. Hall commented that existing parts inventory may be enough to ensure continued production, although “we flag some risk for a hiccup later this summer.”

Estimates

Apple is expected to report its FQ216 total revenue at $52.4bn, versus consensus expectation of $52.0bn, its GAAP gross margin at 39.2 percent, versus consensus of 39.4 percent, and GAAP EPS at $1.99, as compared to consensus of $2.00, Hall mentioned.

The FQ316 estimates are at: total revenue of $48.9bn, higher than the consensus expectation of $47.5bn), GAAP gross margin of 39.1 percent, versus consensus of 39.2 percent, and GAAP EPS of $1.84, ahead of the consensus of $1.77.

DateFirmActionFromTo
Apr 2016BarclaysMaintainsOverweight
Apr 2016BTIG ResearchMaintainsBuy
Apr 2016NeedhamInitiates Coverage onStrong Buy

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