Analysts at Wedbush Securities estimate that Apple Inc (NASDAQ:AAPL) is now “on pace to sell more than 10 million iPhones” for a blowout 2021 Black Friday weekend in a bullish sign for the Cupertino, California-based company’s fiscal first-quarter.
Wedbush analysts maintained an ‘Outperform’ rating and 12-month $185 price target on Apple stock.
“We are seeing shortages in many Apple stores with iPhone 13 Pro (Sierra Blue and Gold the most popular), as we estimate right now demand is outstripping supply for overall iPhone 13 units globally by roughly 15% heading into this holiday season,” the Wedbush analysts said in a note to clients.
“Despite the chip shortage and Rubik’s Cube logistics that Apple (and every other technology, auto, and retail vendor) is dealing with we are seeing tremendous demand trends both in the US and China for iPhone 13 which is a positive sign that Apple could exceed selling 80 million iPhone units in the quarter with stronger Pro versions driving higher ASPs,” they added.
In addition, the Wedbush analysts said Apple is on a scorching pace to sell a record 40 million iPhones between the Black Friday weekend and Christmas, despite the lingering chip shortage limiting iPhone supply globally by roughly 10 million units.
“We estimate in China alone there are roughly 15 million iPhone 13 upgrades for the December quarter as this key region remains a major source of strength for Apple heading into 2022 and beyond. We believe Cook & Co. have been able to get more iPhones into the retail channel over the past week which is a step in the right direction with holiday season now kicking into full gear,” they added.
The Wedbush analysts see the iPhone growth story playing out into 2022 despite supply chain issues.
“With ASPs continuing to be very positive on Pro/Pro Max and as of today roughly 250 million of 975 million iPhones worldwide not upgrading in 3.5 years, we view supply chain issues as nothing more than a speed bump on a multi-year supercycle iPhone 12/13 that continues to play out,” they said.
Apple’s popular AirPods are also set for a strong holiday season.
“We believe in 2022 based on refresh rates and the new design around AirPods 3 that Apple could ship close to 100 million AirPod units with a strong holiday performance already underway,” Wedbush’s analysts said.
“While AirPods today are on a trajectory to represent 5%+ of overall revenues for FY22, this product category continues to speak to the unparalleled flywheel that Cook and Cupertino have with 975 million iPhones worldwide under its belt and 1.7 billion active devices to tap into worldwide and thus further monetize through products/ services as we continue to see with the Apple Watch as well,” they concluded.
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