Cowen Trims PT, Ests on Apple (AAPL) Following Supplier Updates
Cowen and Company trims its price target on Market Perform-rated Apple (Nasdaq: AAPL) from $130 to $125 following guidance updates from suppliers Qorvo and Cirrus Logic.
Analyst Timothy Arcuri commented: Based on ~$4 of content for QRVO and ~$2.25 for CRUS, we estimate this implies a miss of ~15MM or maybe 20MM units depending on the assumptions. This just about matches separate field checks indicating 6S/6S+ builds were ~65-68MM for CQ4 and ~34-35MM for CQ1:16 as of early Nov but have now fallen to ~60MM and ~25MM respectively. To some degree, we do believe AAPL was slightly over-procuring components to avoid the shortages of the 6/6+ but we have always been worried about the new reliance on China for 6S/6S+ and were the first to downgrade the stock in July.
Arcuri is moving FQ216 iPhone units from 53 million down to 47 million and FQ316 from 43 million down to 40 million. FY16 EPS moves from $9.77 to $9.37 and FY17 from $10.30 to $9.64.
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