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Oppenheimer Calls Apple Growth Fears 'Premature'

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In a report published Thursday, Oppenheimer analysts reiterated their Buy rating and price target of $155 on Apple Inc. (NASDAQ: AAPL). The analysts believe that investor concerns regarding the company's declining growth are premature for 2015.

"In fact, we believe some will argue that Apple will record its first year-over-year decline of iPhone sales in FY15. This could put pressure on the stock as investors may start to believe that the iPhone growth story has run its course," the analysts said.

However, according to the Oppenheimer report, fears regarding declining iPhone sales are premature, given that the company has gained share over Android, as well as its sales momentum in China.

In fact, the analysts believe that "Apple's ecosystem, new product categories, and shareholder friendly actions will keep earnings growth trajectory above consensus expectations while new revenue growth engines emerge."

The analysts expect the company to witness demand worth 217 million units from the replacement cycle alone, of which more than half is likely to be accounted for by the U.S. and Chinese markets.

The Oppenheimer report also expressed confidence in iOS offering greater ecosystem advantage, as compared to the Android, especially following the launch of iOS 8 and the Apple Watch. The analysts also expect the company to witness continued sales momentum, market share gains for high-end phones and increased penetration across the various product categories in China. In fact, Apple is likely to post beat and raise quarters through FY16.

Latest Ratings for AAPL

Oct 2017KeyBancUpgradesSector WeightOverweight
Oct 2017BarclaysMaintainsEqual-Weight
Sep 2017PiperJaffrayMaintainsOverweightOverweight

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Posted-In: OppenheimerAnalyst Color Reiteration Analyst Ratings


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