Wall Street worries put the hurting on Apple’s suppliers too

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iPhone 8 Foxconn box
A whole lot of companies rely on Apple.
Photo: Feng

It’s not just Apple which relies on, well, Apple to make money. There’s a whole ecosystem of other companies orbiting the giant Cupertino sun, too. And they’re all affected by whatever news raises or lowers Apple’s share price.

That’s what took place this week when Wall Street’s latest wobble about Apple sent out shockwaves through the supply chain. As a result, a whole lot of companies which do business with Apple suffered their own sympathy stock declines.

Some of the stocks affected include TDK Holding, which fell 1.5% Monday. Nidec, meanwhile, declined 1.7%, while Alps Alpine fell 1.5%. All of these companies are located in Japan. Meanwhile, in Taiwan, Foxconn’s share price fell 1.39%, TSMC’s 0.21%, and Catcher Technology’s 1.94%.

Apple is doooooomed

The lowered share prices came after an analyst at Rosenblatt Securities downgraded Apple’s stock appraisal from “neutral” to “sell.” This was supposedly because Apple faces, “fundamental deterioration over the next 6 to 12 months.” According to analyst Jun Zhang, Apple will see disappointing iPhone and iPad sales, while other product categories will also decelerate.

While Rosenblatt Securities is just one data point, analysts overall are at their least optimistic about Apple in years. That’s not great news for Apple — but it’s even worse if you’re on the supply chain side of things.

As a report by The Information noted recently, shares in suppliers have taken the brunt of recent wobbles about Apple’s future. The average share price for Apple’s suppliers dropped by 23% from the year before, while Apple shares took just a 5% dip.

Apple is due to announce its next quarterly earnings, covering the April through June quarter, on July 30.

Source: CNBC