Analysts Cut Targets on Apple Stock into Earnings Amid Macro and FX Headwinds
2022.07.20 15:14
Analysts Cut Targets on Apple Stock into Earnings Amid Macro and FX Headwinds
By Senad Karaahmetovic
At least two analysts covering Apple (NASDAQ:AAPL) have slashed their price targets on the Cupertino-based tech titan heading into the FQ3 earnings.
An analyst from Wells Fargo cut the price target to $185 from $205 as he sees “a worsening COVID situation in China and beyond, a deteriorating macro environment, and increasing FX impacts as the biggest risks to near-term estimates”.
Still, he reiterated an Overweight rating on AAPL and a Signature Pick designation as he still believes the company is “well positioned to navigate these challenges and believes iPhone demand can fare better than the broader smartphone industry as we see a potential for ongoing richening mix”.
We “believe our positive thesis on Apple remains intact—monetization of growing ecosystem, GM% improvement driven by growing services and premium device mix (although offsetting input cost inflation a concern), cont. product innovation, and capital return,” the analyst concluded.
Similarly, a Morgan Stanley analyst slashed the price target to $180 from $185 as supply chain issues and a strong dollar are likely to limit the upside for the June quarter.
“We expect June Q results slightly below Street and toward the lower end of guidance, with Mac & Services underperformance more than offsetting solid iPhone results. We see potential for more guarded Sept Q commentary,” she told clients in a note.
The analyst also reiterated an Overweight rating on “high quality” AAPL stock.
“Apple remains a near-term bull/bear battleground and we aren’t pounding the table into earnings, but remain OW as a flight-to-quality/best of breed name in a downturn,” she concluded.
Both analysts sit below the consensus on both EPS and revenue for FQ3.
