After Near-Term Outperformance, Barclays Sees Apple (AAPL) Shares Flat from Here

September 29, 2016 7:56 AM EDT
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Price: $117.65 +0.90%

Rating Summary:
    62 Buy, 8 Hold, 5 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 26 | Down: 29 | New: 38
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Barclays analyst Mark Moskowitz removed the Top Pick designation on Apple (NASDAQ: AAPL) and lowered estimates and the price target on the stock to $114.00 (from $115.00). The firm maintained an Overweight rating, although the new price target suggests essentially zero upside from current levels.

In fact, the analyst sees near-term tumult after the recent run-up in the stock. The analyst notes shares could be overbought, rising 7% since Sept. 1 versus S&P 500 being flat.

Moskowitz said their research suggests a recovery in global smartphone growth could be pushed out and industry checks suggest iPhone sales trends could be at risk of petering out in coming months.

The firm's 2016 smartphone revenue and unit growth estimates are for a decline of -2.9% and growth of 2.6%, versus decline of -0.7% and 3.7% growth previously.

Moskowitz said the tone in the supply chain appears cautious. "It has been suggested to us that late 2016 could be similar to late 2015 when smartphone builds fell precipitously," he said.

While cautious near-term on the iPhone outlook, the firm is lifting estimates for the Mac and iPad businesses.

FY 2016 EPS estimates were lowered from $8.27 to $8.24 and FY 2017 EPS from $8.38 to $8.29.

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