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150 Million New iPhone Users In 3 Years? Goldman Says SE Should Help Apple Expand In Emerging Markets


Goldman Sachs’ Simona Jankowski maintained a Buy rating on Apple Inc. (NASDAQ: AAPL), with a price target of $155.

“At a small media event in its Cupertino headquarters, Apple made several product introductions, including the new 4” iPhone SE, the 9.7” iPad Pro, new watch bands, and incremental software & ecosystem enhancements,” Jankowski mentioned.

iPhone SE

Jankowski noted that the timing and specs of the iPhone SE were mostly in-line with expectations, although the price point of $399 was lower than the expected $450.

Related Link: iPhone SE, Smaller iPad Pro Highlight Apple's March Event

This represents the lowest price point ever for a new iPhone, given that even the mid-range iPhone 5c model was launched at $549. The SE model will replace the iPhone 5s, which has been selling for 2.5 years at $450.

“Thus, we view the SE as offering strong performance (essentially equivalent to the new iPhone 6s) but in a smaller package and at an attractive price point,” Janknowski stated.

iPhone SE To Drive Demand

The analyst believes that this might be able to drive improved demand elasticity for the iPhone SE, as compared to the earlier estimate of 12 million units in the first year. However, this could be offset by lower sales of the discontinued 5s model.

“We expect the SE to help Apple expand its TAM into emerging markets, which we estimate could drive 150mn new iPhone users over the next three years,” Jankowski added.

Apple also announced a reduction in the prices of the iPad Air 2 by $100 and the Apple Watch by $50.

Latest Ratings for AAPL

Aug 2020WedbushMaintainsOutperform
Aug 2020Wells FargoMaintainsOverweight
Aug 2020B of A SecuritiesDowngradesBuyNeutral

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