iPhone demand remains strong, according to a respected analyst. This despite the supply chain issues that are slowing production of other Apple products.
The analyst is bullish on Apple, and says its stock price should be much higher than it currently is.
‘iPhone demand is holding up better than expected’
There are plenty of reasons why iPhone demand could be weak right now. There’s inflation and threats of a recession. The Chinese government is shutting down whole cities in draconian efforts to prevent the spread of COVID-19. But demand for Apple handsets reportedly remains strong.
“As of now we believe iPhone demand is holding up better than expected (despite the various supply issues that have plagued Apple and the rest of the tech sector) and are trending better than management’s guidance thus far in the quarter,” Wedbush analyst Dan Ives wrote via Twitter on Friday.
And Apple has been able to produce enough iPhones to meet the demand. “Over the last few weeks our Asia iPhone supply chain checks have been ‘surprisingly resilient’ despite the zero Covid driven demand issues in China that remain the elephant in the room for the Apple story,” according to Ives.
The same can’t be said of other products designed in Cupertino. Supply problems are causing lengthy waits for the latest MacBook Pro and the new Mac Studio desktop.
AAPL is undervalued
The Wedbush analyst is bullish on Apple and iPhone all the way into 2023. Ives said, “Apple remains our favorite tech name as we reiterate our OUTPERFORM rating and $200 price target with these recent checks giving us further confidence in the iPhone cycle into 2023.”
AAPL shares are selling for about $140 as of Friday morning, so he thinks the stock is very undervalued. And his valuation comes after the share value has dropped 23% so far in 2022.
As of now we believe iPhone demand is holding up better than expected (despite the various supply issues that have plagued Apple and the rest of the tech sector) and are trending better than management's guidance thus far in the quarter.
— Dan Ives (@DivesTech) May 20, 2022
