The Nikkei Asian Review quoted a source familiar with the matter, who said iPhone 11 production has been “much busier than we expected,” and order volume is now ahead of last year’s levels.
The production hike could be a sign that Apple has hit a home run with its surprising budget-conscious iPhone 11 strategy. For the first time in history, Apple dropped the prices of its updated models this year.
How To Play It
“We continue to believe China as a region is currently one of the main catalysts of demand for the iPhone 11 and is tracking roughly 20% ahead of plan, which is a surprise to many investors in light of the current UFC trade battle between the US and China with pro Huawei and competitive worries abound,” Ives said.
Wedbush has an Outperform rating and $245 price target for Apple.
“We raise our Diversified Manufacturing Segment (DMS) revenue and margin estimates for the November quarter which is typically the strongest quarter for Jabil,” Bhattacharya said.
He remains cautious on the stock with a Neutral rating and $37 price target given the weak macroeconomic backdrop.
For years, Apple skeptics have predicted saturation of the iPhone market would eventually catch up to Apple, but the company seems to always find a way to deliver. Apple took a gamble in potentially sacrificing iPhone margins for volume with its pricing cuts, and it looks like that gamble may pay off for investors.
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