Is a supplier's woes reason for Apple to worry?
Speaker maker Jabil Circuit Inc. disappointed Wall Street with lower-than-expected earnings and lowered its next quarter guidance. Shares in the electronics company dropped 20% to two-year lows on Wednesday.
(Read more: Ahead of the Bell: Jabil Circuit)
What does that have to do with Apple? Because Jabil provides speakers for the iPhone 5c and part of Jabil's problem is soft demand for that model.
In his latest note to investors, hedge fund manager Doug Kass of Seabreeze Partners, says Apple's stock will take a hit, writing:
"One of the big problems for JBL appears to be soft demand for the iPhone 5c (which JBL provides casings for). Keep in mind that 5c indications have been tepid for months – it has been clear this handset wasn’t selling particularly well pretty much since it was released (myriad press reports have pointed to AAPL trimming production for this product). Meanwhile, sales trends for the 5s have been very strong (JBLRead More »from Doug Kass: This could be trouble for Apple