Can A Delayed iPhone 5 Hurt These Names?

An article from Boy Genius Report this morning says that Apple (NASDAQ: AAPL) could delay the iPhone 5 "slightly.

The rumors first came from 9to5Mac.

Apple is going to release an additional iPhone 4 coming in the next few weeks, and many are expecting the iPhone 5 to be released on the same day, October 7th. Yet, if there is a delay to the iPhone 5 it could potentially hurt the quarters of Apple's suppliers, such as Qualcomm (NASDAQ: QCOM), Broadcom (NASDAQ: BRCM), ARM Holdings (NASDAQ: ARMH) and Taiwan Semiconductor (NYSE: TSM), which sources the chips for many of Apple's suppliers.

The delays are being attributed to design and production delays at one of Apple's assembly lines. The company uses Pegatron, Foxconn as its main production sources.

With the delays, Apple may see shortages into 2012, and may not announced the new phone on October 7, but perhaps a week or two later. Despite of all this, the chip companies that Apple uses to power its iconic phone will benefit eventually, but perhaps not as early as some expect. Goldman Sachs took ARM Holdings off its Conviction Buy List this morning, citing valuation. Perhaps Goldman knows something the public does not. I doubt it, considering the Cupertino-based company is more secretive then the C.I.A., but you never know.

We went from potentially having a September release, to now October. Any more delays and it could seriously hurt suppliers quarters'. The Greenday song "Wake Me Up When September Ends" seemed funny and applicable, but any more delays, and it will not be a laughing matter.

These names will all benefit from the iPhone 5 when it is released, as well as an additional iPhone 4, but the companies will need to explain any earnings or revenue misses if Apple is in fact experiencing delays. That is not something shareholders are going to take to kindly to.

ACTION ITEMS:

Bullish:
Traders who believe that Apple will in fact deliver the iPhone 5 on time might want to consider the following trades:

• Consider buying dips in the names of any of the above mentioned names. The iPhone 5 is likely to be the holiday shopping seasons best selling tech gadget.

Bearish:
Traders who believe that the iPhone 5 might be delayed may consider alternate positions:

• If Apple is experiencing delays, consider short term shorts of the names above, or perhaps near-dated puts. The iPhone 5 will come out eventually, but even a week could hurt the quarters of these companies.
  
  

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.