Home Latest Apple Stock Offers a Good Hiding Place in a Rocky Stock Market,...

Apple Stock Offers a Good Hiding Place in a Rocky Stock Market, Says Deutsche Bank – Yahoo Finance

Ads

In less than a week — Thursday, April 28, after close of trading — tech leader Apple (AAPL) is due to report its fiscal Q2 2022 financial results. Yes, it's Q1 earnings season right now. But as in so many other things, Apple is a bit ahead of the times. For Apple, the calendar has already flipped to fiscal Q2.
As earnings day gets closer, investors are having some early jitters. Since the start of the month, Apple stock is down 5% — but not to worry, says Deutsche Bank analyst Sidney Ho. "While concerns about the China smartphone market and manufacturing shutdowns in China have increased recently," Apple stocks remains "a good hiding place in this volatile market." And next week's earnings are probably going to turn out just fine.
Sure, on the one hand, the rapid spread of Omicron coronavirus in China has caused city-wide shutdowns and shuttered key factories, which could snarl supply chains and delay delivery of certain Apple products to market. iPhone supply chains in particular, however, which account for the majority of Apple's profits, should be in pretty good shape. And to the extent that demand for iPhones still outstrips supply, that will be good news for both sales and pricing power.
Demand, after all, still looks good for Apple products. In a typical year, Ho notes that Apple's sales fall as much as 30% sequentially between fiscal Q1 and fiscal Q2, but he believes results will be at least a little "better" than that this year — about a 28% sequential decline for iPhone revenues, and only a 24% decline for revenues overall. As the analyst explains, demand for high end smartphones in particular (and iPhones are considered very high end) "will hold up better than lower-priced options," leading to the better-than-historical result in fiscal Q2.
Where Ho sees more reasons to worry is in fiscal Q3 (i.e. everyone else's calendar Q2). Covid-related shutdowns in China will affect supply chains more and more the longer shutdowns drag on. While again, Ho sees Apple working effectively to insulate its marquee franchise from supply shocks, he worries that "outside iPhone, supply chain will likely remain a problem," perhaps resulting in certain MacBook model deliveries being held up for as long as six to eight weeks.
That being said, the more immediate Q2 numbers should look pretty good next week. Ho forecasts sales of about 60 million iPhones in fiscal Q2, leading to $51 billion in iPhone revenue — up 7% year over year. Overall revenues should be $96 billion — also up 7% — with earnings per share ahead of Street estimates at $1.46.
What's more, fiscal Q3 should be even stronger for Apple. Looking out an additional three months, Ho forecasts that Apple will sell 53 million iPhones next quarter, leading to iPhone revenue growth of 11% year over year. Overall sales growth should be 12% year over year — $91 billion — with earnings of $1.37 per share — both of which numbers are ahead of Wall Street consensus.
With growth trends intact, Ho wraps up with a reiteration of his "buy" call on Apple, and a $210 price target for Apple stock. This figure implies ~29% upside from current levels. (To watch Ho's track record, click here)
Unsurprisingly, Apple stock tends to attract a lot of attention — the stock has 29 recent analyst reviews on record, and they include 23 Buys against 6 Holds to give the company its Strong Buy consensus rating. The shares have an average price target of $193.11, indicating room for ~19% growth from the current price of $163.21. (See AAPL stock forecast on TipRanks)
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
Related Quotes
(Bloomberg) — Bill Gates has a short position against Tesla Inc. that would now need between $1.5 billion and $2 billion to close out, Elon Musk said Friday in a series of tweets.Most Read from BloombergElon Musk Says Bill Gates Has ‘Multi-Billion Dollar’ Tesla Short PositionElizabeth Holmes Urges Judge to Overturn Verdict and Acquit HerWalmart, Gap and Others Amass $45 Billion in Extra Stuff to SellRussian Wins in Eastern Ukraine Spark Debate Over Course of WarUkraine Latest: EU Leaders Talk t
Stop investing in mediocre businesses. Buy the best, instead.
Amazon's stock split will take place on June 3, but don't expect to wake up to riches overnight.
‘I have made an earnest attempt to get the bank to take their money back, so I was wondering if at any point or time the money would become legally mine.’
(Bloomberg) — The stock market has staged a ferocious rebound in the past week after almost falling into a bear market. Don’t get too excited about that, says Victoria Greene, founding partner and chief investment officer at G Squared Private Wealth.Most Read from BloombergElon Musk Says Bill Gates Has ‘Multi-Billion Dollar’ Tesla Short PositionElizabeth Holmes Urges Judge to Overturn Verdict and Acquit HerWalmart, Gap and Others Amass $45 Billion in Extra Stuff to SellRussian Wins in Eastern U
The stock market pulled back from the brink of a bear market as rate-hike expectations eased, at least for now. Here's what it will take to signal a bottom.
When Buffett buys, the market listens.
Markets are shaky. Your income stream doesn’t have to be.
If we can find high-quality stocks with high dividend yields, all the better. In this article, we'll take a look at three high-yield stocks that are also attractive on a total return basis. The company targets the lower end of the market with smaller, more attainable single-family homes in 15 states in the U.S. In addition, it has a mortgage-origination business for its homebuyers, insurance coverage for the homes it sells, and related products and services.
Don't make the same mistake as Zillow when you try to price a home.
Real estate mogul Barbara Corcoran didn't mince words when asked about Tesla (TSLA) CEO Elon Musk's recent behavior.
Will we have enough to ‘live a simple life’ in retirement? Many other retirees wonder the same thing as you, and may be in similar financial circumstances where they’re able to pay the bills and have money saved in their retirement accounts. Your interest rate is fantastic, you’re capable of making the monthly payment from just your pension and Social Security without tapping into your 401(k) and you have so much of your home already paid off — all wins.
Whether you're looking for household goods at discounted prices or need to buy your grocery items in bulk, Costco is the go-to retailer for millions of shoppers across the U.S. But despite its ability to attract a loyal following, Costco has made a number of changes recently that haven't thrilled customers. In April, the warehouse retailer got rid of its special COVID hours for seniors, and just this month, Costco ended its mortgage program for members. Now, the retailer has a new warning for sh
Stocks have been inching back in recent days from the brink of bear market territory. It may be time to scoop up shares at steep discounts.
When looking for the best artificial intelligence stocks to buy, identify companies using AI technology to improve products or gain a strategic edge, such as Google, Microsoft and Nvidia.
Meanwhile, the growth-stock-focused Nasdaq Composite is off 30% from its November record closing high. Going shopping during steep corrections and bear markets offers investors the opportunity to buy innovative growth stocks that can deliver transformational wealth…with some patience, of course. What follows are five examples of growth stocks with supercharged return potential that can, over many years or decades, put investors on a path to complete financial independence.
The stock market selloff has made many stocks look cheap—but smart investors need to be selective. Here are six high-quality companies that trade at reasonable valuations.
Amazon's stock split will take place on June 3 and you'll end up with more shares in your account if you qualify.
Here's what a fundamental and technical analysis says about Google stock. GOOGL stock buybacks remain high as web search and YouTube advertising rebound. But cloud computing growth is key.
The Dow Jones rallied amid encouraging inflation data. Tesla stock jumped even as CEO Elon Musk issued a warning. Apple stock surged.

source

Ads
Previous articleIs this our most accurate look at the iPhone 14 yet? – Creative Bloq
Next articleElon Musk's not-so-secret weapon: An army of Twitter bots – Los Angeles Times
Nitika is a MCA graduate and works as all-round news writer at The Hoops News. In free time, she works on Photoshop and plays GTA V on her Xbox. A tech-enthusiast at heart, she explores ways that businesses can leverage the Internet and move their businesses to the next level. You can contact her at nitika@thehoopsnews.com.