Investors Flee From Samsung On Lower Sales Expectations

Over the past several months, investors have slowly packed up and left Apple (NASDAQ: AAPL) behind. The company may set new records nearly every quarter for the past several years, but until it can produce numbers that beat analysts' lofty expectations, investors will continue to be wary of its future.Contrary to popular belief, Apple is not alone. Investors have treated BlackBerry (NASDAQ: BBRY) with the same skepticism. First they bought up the stock, supporting its future. Then they ran for the hills, fearing that reality would not be as beautiful as the fantasy they concocted when they purchased the stock.Now Samsung is getting the Apple treatment -- and it's all thanks to one report.JP Morgan analysts JJ Park and Jay Kwon do not believe that Samsung's Galaxy S IV will outperform its hugely popular predecessor. In a recent report, Park and Kwon wrote, "Our supply chain checks (camera module, casing makers and AP) show monthly orders have been cut 20%-30% to 7 to 8 million units (from 10 million) starting July and 3Q13 due to weak demand in EU and the domestic market, while US demand (QCOM-based smartphone) remains relatively robust," the analysts wrote in their report this week."S4 momentum slows down much faster than S3: S4 had stronger momentum in the first quarter of launch but the following quarter (3Q13)'s shipments will likely disappoint we believe. Also, we estimate S3 shipments to decline by half in 2Q13. Hence, weaker-than-expected high-end smartphone shipments will likely result in lower margins, by our estimation."According to The Wall Street Journal, Samsung's shares plummeted more than six percent after the report was released. It proved to be the company's biggest single-day percentage drop in more than nine months.While the report may sound troubling, investors should do the math before they react.If JPMorgan's estimates are accurate, Samsung shipped (or will ship) 10 million Galaxy S IV units in June. Starting in July, shipments will fall to seven or eight million.At seven million units per month for the rest of the year, Samsung will ship a total of 52 million units (10 million in June + seven million for six months = 52 million) in 2013.If Samsung is able sell the majority of those units, the Galaxy S IV should fall in line with (or surpass) its predecessor.As of November 2012, Samsung announced that it had sold 30 million Galaxy S III units. By January 2013, the company sold 40 million units. Two months later, total sales reached 50 million units.If Samsung can ship 52 million Galaxy S IV units by the year's end, is it really a stretch to imagine that retailers will have sold all of them by March 2014?Louis Bedigian is the Senior Tech Analyst and Features Writer of Benzinga. You can reach him at 248-636-1322 or louis(at)benzingapro(dot)com. Follow him @LouisBedigianBZ