Despite a challenging macroeconomic environment marked by high interest rates and inflationary pressures, Apple’s latest iPhone launch is off to an impressive start.
Analysts are reporting robust sales figures, particularly for the high-end iPhone 15 Pro Max, defying initial concerns about consumer spending. In this article, we delve into the reasons behind this surprising success and its implications for Apple’s stock.
Strong Start for iPhone 15 Lineup
Early indicators suggest a promising outlook for Apple’s iPhone 15 lineup. Analysts at Morgan Stanley, Wedbush, and Credit Suisse have all noted positive trends in pre-orders.
Morgan Stanley’s data indicates a solid beginning to the cycle, with the iPhone 15 Pro Max standing out. Wedbush analysts report that pre-orders are surpassing expectations, and Credit Suisse has observed extended lead times for iPhone 15 Pro Max orders.
Apple Stock Receives Bullish Ratings
Goldman Sachs’ Michael Ng has joined the chorus of optimism surrounding Apple’s new iPhones. While acknowledging the limited visibility into iPhone supply, Ng highlights the evident demand outstripping supply.
This positive sentiment is reflected in his “buy” rating on Apple stock, with a 12-month price target of $216. Other analysts are equally bullish, with Morgan Stanley, Wedbush, and Credit Suisse setting price targets of $215, $240, and $220, respectively.
Diverse Demand and a Cautionary Note
The success of the iPhone 15 lineup is not uniform across all regions. Barclays analyst Tim Long reports challenging pre-order sales in China, a crucial market for Apple, accounting for about 19% of its fiscal 2022 sales. Long’s channel checks indicate a shift toward lower-priced iPhones in China compared to the previous year. Consequently, he maintains a comparatively bearish outlook with a 12-month price target of $167.
Despite concerns in the Chinese market, Long’s data reveals a relatively minor 5% year-over-year decline in overall unit orders. This modest dip in a critical market suggests that any decline in iPhone sales in China might not severely impact the potential strength of Apple in North America and other markets.
Apple’s Resilience
In an economic landscape fraught with uncertainty and financial challenges, Apple’s new iPhones have defied expectations with strong sales, particularly for the premium iPhone 15 Pro Max.
Analysts are optimistic about the company’s prospects, and bullish ratings are bolstering confidence in Apple’s stock. However, the cautionary note from Barclays highlights the importance of regional variations in demand.
Despite this, the overall resilience of iPhone sales is a positive sign for Apple, suggesting that consumer demand continues to drive the company’s success, even in challenging times.
