Analysts so far appear mostly unfazed by the Apple coronavirus impact. The prevailing view is that the effect will be temporary, and that Apple’s core strengths mean the medium- and long-term outlook remains good.
Investors appear to be taking the same view. The stock did take a bit of a dip yesterday, at one point 3.2% down after a bigger fall in pre-market trading, but ended the day just 1.83% down …
Business Insider reviewed investor’s notes from four analysts, who all remain bullish on the stock. All four reports refer to the issue as a temporary one, with long-term prospects unaffected.
JPMorgan described the problem as ‘temporary headwinds.’
Wedbush said the Apple coronavirus impact was just ‘a timing issue.’
“We expect most long-term investors in Apple shares to look past these temporary headwinds, with both products and services continuing to demonstrate strong underlying consumer demand,” the team led by Samik Chatterjee wrote.
RBS says while the ultimate impact remains unknown, most sales lost in Q2 will simply be delayed to Q3.
Wedbush sees the firm potentially bouncing back in the June quarter and riding the “5G super cycle” through the end of the year.
Canaccord Genuity says the company’s relatively diverse income streams will help.
“We view the situation as temporary and our longer-term outlook is unchanged.”
Apple’s diversified mix of product and service revenues, along with expected boosts to share buybacks, will keep the stock from falling too much as it weathers the coronavirus storm, analysts Michael Walkley and Anthony Nemoto wrote. “We believe Apple is well positioned for strong trends across all its business lines.”
