Mizuho Securities Analyst: "iPhone Sales Are Going To Slow Down From What We Saw In The Last Two Quarters"

Apple Inc. AAPL posted spectacular results post market closing on back of a 55 percent increase in iPhone shipment. However, Abhey Lamba of Mizuho Securities feels that this run of the iPhone is going to end soon. He was on CNBC Tuesday to discuss why that will happen and how it will impact Apple’s stock.

Slowing Down

“Going forward we think that iPhone sales are going to decelerate,” Lamba said. “And this is where in a alternate year cycle Android does well in one year and then Apple does well in the other year and this year we are seeing much stronger uptick, but going forward we do think iPhone sales are going to slow down from what we saw in the last two quarters.”

December: The Quarter Of Declines

Lamba was asked how he can be negative on stock when the company has announced a massive buyback that could provide support. He replied, “Couple of things on that, first on the buybacks, they have been doing those types of buybacks which has been offering support. So, the buybacks are $25 billion a year.”

“So, they have been at that run rate for the last few quarters that support kind of stays around there and in terms of the stock price we are at a 14 times 2016 earnings number and we don’t think there’s whole lot of upside to that and historically if you look at the stock, it has stayed in direct relationship with iPhone shipments.”

“ The stock has had a hard time performing when the iPhone shipments are decelerating and that’s where we think there’s significant deceleration of iPhones shipments could have a way on the multiple and also one other thing…we think December could be the very first time we could see iPhone shipments actually could post year-over-year decline,” Lamba concluded.