Loading...
See More

Apple results spur price target cuts

Jan 24 2013 20:26 Reuters
Apple iPod Touch

The Apple iPod Touch is still a cool device. (Duncan Alfreds, News24)

Related Articles

Weak outlook tarnishes Apple's results

Are Apple's best days behind it?

Samsung, Apple lead smartphone race

Apple shares fall on iPhone demand fears

Apple cuts orders for iPhone 5 parts

Apple disappointment hits European shares

 
London - Weaker-than-expected holiday sales of Apple Inc's iPhone reinforced fears that it is losing its dominance in smartphones, driving its shares down 9% in premarket trading and drawing another round of stock price target cuts.

Fourteen brokerages including Barclays Capital, Mizuho Securities USA, Credit Suisse, Deutsche Bank, Raymond James, Robert W. Baird & Co and Canaccord Genuity cut their price target on the stock by $142 on average to $599.

Apple's shares closed at $514 Wednesday on the Nasdaq.

Jefferies & Co cut its rating on Apple's stock to "hold" from "buy" and slashed its share price target by $300 to $500.

Jefferies analyst Peter Misek, who has previously raised red flags about Apple cutting orders to suppliers, said the iPhone slowdown was "real and material" and here to stay.

"We think Apple is losing the screen-size wars," Misek said, noting that demand was moving away from the iPhone's 3.5-inch and 4-inch screens to screens of 5 inches offered by rivals such as Samsung Electronics Co Ltd, HTC Corp and Nokia Oyj.

Misek is a top-rated analyst for the accuracy of his earnings estimates for Apple, according to Thomson Reuters StarMine.

Apple said it shipped a record 47.8 million iPhones in the December quarter, but this trailed the average analyst forecast of 50 million units.

Deutsche Bank trimmed its price target to $575 from $800, and said Apple should start making a lower-priced iPhone to arrest the market share loss.

Credit Suisse analysts said a new product cycle and wider telecom carrier selection could be possible catalysts for the company, but added that these were not imminent.

"We believe a lower ability to beat earnings per share expectations, and some concerns on demand, may weigh on the stock near-term," said Credit Suisse, which cut its target price by $150 to $600.

Up to Wednesday, 24 analysts had lowered their price targets since October when Apple reported its fourth-quarter results, according to Thomson Reuters data.

Apple is the lowest ranked stock among the marquee technology firms in the United States based on the change in analyst sentiment, or Analysts Revision Model (ARM), according to StarMine.

Apple's global ARM score of 10 is well below Google Inc's 34 and Microsoft Corp's 19 out of a possible 100. Nokia and Samsung have scores of 82 and 89, respectively.

Research in Motion Ltd has a perfect score of 100, according to the model, which measures analysts' revision of key indicators such as earnings and revenue estimates and changes to their ratings.

Apple shares were trading at $468 before the bell.

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.

apple
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
7 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

Small Business

New forms of digital technology are changing the very ways in which entrepreneurs run their businesses.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...