Actionable news
All posts from Actionable news
Actionable news in AVGO: Avago Technologies Limited,

Analyst: Buy The Post-Earnings Dip In Apple Suppliers

Trade with confidence. Are you a professional trader? Be the first to get the alert with Benzinga Pro's real-time newsfeed and audio squawk and never miss an opportunity again.
Don't miss the chance to try it FREE today.

Apple Inc. NASDAQ:AAPL, Skyworks Solutions, Inc. NASDAQ:SWKS - Analyst: Buy The Post-Earnings Dip In Apple Suppliers

The market clearly is not impressed by Apple Inc AAPL 6.04%’s Q1 earnings report, and the stock of the world’s largest company is down 6 percent in Wednesday’s session. But Apple’s ecosystem is so large that its earnings impact a whole slew of suppliers as well.

Although Q1 iPhone numbers came in ahead of estimates, iPad and Mac numbers were weak, and Apple’s sales guidance of $41-43 billion came up well short of consensus estimates of $47.3 billion.

Despite the rough report, top Apple suppliers were performing relatively well in Wednesday’s trading session. Skyworks Solutions Inc SWKS 0.45% was down just 2.4 percent and Broadcom Ltd AVGO 0.02% was off 1.7 percent.

Related Link: Why Apple Could Layoff Between 25,000 And 30,000 Of 115,000 Employees By End Of Year

Cirrus Logic, Inc. CRUS 9.58% is actually experiencing a relief rally and surged 5 percent in Wednesday morning’s session.

Oppenheimer analyst Rick Schafer believes pricing pressures may be impacting Apple suppliers even more than the total unit number.

He says that traders should be buying any dips in top iPhone suppliers.

“We continue to believe suppliers (AVGO, SWKS, CRUS) with sustained content increase opportunities are best positioned to grow in a flattening iPhone unit market and would use any weakness as a buying opportunity,” Schafer explains.

Oppenheimer maintains Outperform ratings on all three suppliers and on Apple itself.

Disclosure: the author holds no position in the stocks mentioned.

Apr 2016Brean CapitalMaintainsBuy
Apr 2016BarclaysMaintainsOverweight
Apr 2016CitigroupMaintainsBuy

© 2016 Benzinga does not provide investment advice. All rights reserved.