Apple (AAPL) PT Raised to $296 at JPMorgan on 4 5G iPhone Models in 2020

JPMorgan analyst Samik Chatterjee raised the price target on Apple (NASDAQ: AAPL) to $296.00 (from $290.00) on increases in both volume forecasts and EPS estimates after supply chain checks indicate that the company could launch 4 new iPhone models in 2020. Key points from the checks include:

1) Apple is likely to launch four new iPhone models in September 2020 (one 5.4”, two 6.1”, and one 6.7”), including all four with 5G capabilities, but only two with ToF World-facing 3D Sensing

2) Expect two mmWave capable models (also supporting sub-6 GHz); expect two lower-end models to support only sub-6 GHz

3) Starting 2021, we expect Apple to smooth iPhone seasonality by shortening launch intervals and introducing two new iPhones in both 1H21 and 2H21

4) Updated BOM analysis points to an increase of $30-$40 for 2020 iPhones vs. comparable 2019 iPhones, more modest relative to investor expectations

The analyst reiterated the Overweight rating stating "In addition to a 4.7” LCD model (popularly referred to as iPhone SE2), expected to launch in 1H20, we now expect four launches in 2H20 (September). The 2H20 lineup will include all OLED phones, with screen sizes of 5.4” (one model), 6.1” (two), and 6.7” (one), broadening the screen size range from 5.8” to 6.5” in 2019. We expect the two higher end models (one 6.1”, one 6.7”) to include mmWave support, triple camera and World facing 3D sensing, while the lowerend models (one 6.1”, one 5.4”) will include support for only sub-6 GHz and dual camera (no World-facing 3D sensing)".

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