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Apple's iPhone 7 Build Leads This Analyst To Shift From Positive To Cautious

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Apple's iPhone 7 Build Leads This Analyst To Shift From Positive To Cautious

The latest supply chain updates for Apple Inc. (NASDAQ: AAPL) suggest that early 2017 would be a period of build cuts and uncertainty, Bluefin’s John Donovan said in a report.

He downgraded his view on the stock from Positive to Cautious. The iPhone internal build estimate for Q1 has been reduced from 59 million to 53 million.

First Half Of 2017

Following the estimate reduction, Bluefin’s total iPhone estimate for the March quarter is now significantly short of consensus expectations.

“We believe the present build outlook is far more representative of the projected demand environment for the March quarter,” Donovan noted.

The estimate reduction reflects sharp reductions in the iPhone 7 and SE models, while the iPhone 7 Plus remains unchanged.

Estimates for iPhone 7 and 7 Plus totals for Q2 have not been changed. Donovan mentioned, however, that there would likely be more mix changes, reflecting stronger demand for 7 Plus demand and lower SE production. For the first half, the estimate for total builds has been reduced from 107 million to 99 million.

Q4 Remains The Same

Although the forecast for iPhone builds in Q4 of 2016 remains at 80 million, the mix of iPhone 7 and 7 Plus continues to change “largely due to limitations to iPhone 7 Plus build capability,” the analyst stated.

Apple's stock has shed about $2 since last week, closing Friday at $109.90.

Latest Ratings for AAPL

DateFirmActionFromTo
Jan 2020UpgradesHoldBuy
Jan 2020ReiteratesBuy
Jan 2020MaintainsBuy

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Posted-In: Bluefin iPhone iPhone 7 John DonovanAnalyst Color Downgrades Analyst Ratings Tech Best of Benzinga

 

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