Is Apple Inc.’s stock a safe place to hide amid economic uncertainty?
That seems to be a source of debate on Wall Street these days, with conflicting recent views from analysts highlighting some of the current controversy around Apple
Mizuho’s Jordan Klein, an analyst associated with Mizuho’s sales team and not its research arm, wrote Tuesday afternoon that while he doesn’t see particular risk to Apple’s September quarter, he has broader fears about the name.
Klein sees retail investors “hiding” in Apple’s stock, and he said that “some shorter-duration institutional investors” might be doing so as well ahead of the upcoming earnings report. But Klein cited other concerns including that “[n]o mutual fund investors seem to own it or are positively biased,” based on his recent conversations, while hedge funds appear “mixed at best.”
He pointed to commentary from Mizuho Japan’s component-technology analyst Fumihide Goto, who recently wrote that Apple’s management may have to lower its production forecasts by the second half of November. Though Apple executives may take a bullish view of iPhone 14 Pro and Pro Max demand when addressing investors on the next earnings call, Klein thinks that a subsequent decision to trim production targets would eventually ripple through the business press and pressure the stock.
Citi Research analyst Jim Suva feels more upbeat. He wrote Tuesday afternoon that he was “not fearful or concerned about Apple’s upcoming earnings report” amid “media and investor concerns.”
“Mixed news flow related to iPhone builds [is] not uncommon during this time of the year,” Suva continued, but he’s encouraged by positive indications about demand for Apple’s higher-priced iPhones. Traction for more expensive iPhones, along with decreases in component prices and drops in freight costs, could partly offset some of the pressure Apple is feeling from foreign exchange, he wrote.
Suva also sees exciting things ahead for Apple, including the launch of a foldable phone next year and an eventual entry into the market for augmented-reality headsets. He reiterated a buy rating on Apple shares and a $185 target price.