March Is Apple's Low Point: Why Rob Cihra Is Buying

Rob Cihra of Sterne Agee CRT maintained a Buy rating on Apple Inc. AAPL, with a price target of $145.

"Apple looks to be planning a media event Mar 21, not yet confirmed but where we'd expect it to intro the mid-cycle revamp of its $450 4-inch iPhone ("SE"? replacing the 2.5-yr-old 5s), as well as refresh the 9.7-inch iPad and possibly start migrating MacBooks to Skylake," Cihra said.

The analyst believes the company would see more 20 percent year-on-year decline in iPhones during the March quarter, although this would mark a trough in year-on-year declines as compared to the tough iPhone 6 comp in 2015.

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"Elongating replacement cycles and China weakness remain a headwind but we nevertheless believe Jun and Sep qtr declines can moderate to single digits and set up an iPhone 7," which could then see a 10 percent year-on-year rise in units in CY17, Cihra pointed out.

Cihra also expects to see 3 million new iPhone "SE" units in the June quarter, representing 7 percent of the mix and likely to narrow the total iPhone decline to less than 10 percent year-on-year, as compared to the more than 20 percent year-on-year expected for the March quarter.

The analyst expects the new 4-inch iPhone to be priced starting at $450 and for this model to grow to about 17 percent of the unit mix in CY16.