Apple ‘sales barometer’ indicates record 20% month-over-month growth
December 6, 2013 8:08 AM
Apple’s recent product launches and the Thanksgiving/Christmas shopping season may be coming together in one giant perfect storm — the good kind. Cantor Fitzgerald analyst Brian White says the company’s sales performance in November was very likely the strongest in history.
“With approximately 97 percent of the sales now accounted for in our Apple Barometer, we estimate sales in November rose by approximately 19-20 percent month-over-month, and well above the November average of up 6 percent over the past eight years,” he said in a research note to investors. “As such, we believe this November will prove to be the strongest in the history of our Apple Barometer.”
Apple-iPhone-5C-57-1024x682Apple, of course, just recently launched new iPhones, new iPads, new iPad minis, and may — or may not — have just signed a deal with China Mobile, which could result in tens of millions of new customers next year.
But White’s “Apple barometer” measures current sales by polling Taiwan-based suppliers whose products and components that are used in the majority of Apple’s products, and generate a high percentage of its sales.
Based on the growth, White believes that Apple’s quarterly sales could double expectations, based on record growth in October as well as November. He expects sales to drop 10 percent month-over-month in December, which will still result in a 28 percent jump quarter-over-quarter. That quarter, of course, is calendar Q4 and fiscal Q1, 2014.
Apple stock has jumped in the last few months from a low of $450 in September to it’s current $563. If the company does indeed report earnings that match White’s predictions, AAPL could start to climb even farther — perhaps even to approach the lofty $700 heights of 2012.
Upside potential for Apple this quarter
As for the current quarter, iPhones are likely to go for sale on China Mobile on Dec.18. It means there will be about two weeks before the current December quarter ends. But Apple Inc. (NASDAQ:AAPL) hasn’t included the estimated revenues generated by this deal in its December quarter guidance, according to Apple Insider. So, Piper Jaffray analyst Gene Munster thinks it will have significant upside potential on the stock. Munster estimates Apple Inc. (NASDAQ:AAPL) to sell 17 million iPhones to China Mobile in 2014.
Apple Inc. (NASDAQ:AAPL) shares were down 0.25% to $566.50 in pre-market trading Friday. Cantor Fitzgerald has a Buy rating on the stock with $777 price target.
Apple Inc. iPhone Sales To China Mobile Could Top 24M In 2014
by Vikas ShuklaDecember 6, 2013
Apple Inc. (NASDAQ:AAPL) has finally signed a deal with China Mobile after months of speculation, reports the Wall Street Journal. The Cupertino-based company usually has an upper hand while negotiating a deal because no telecom carrier can afford not to have the iPhone on its offering. But this time, Apple Inc. (NASDAQ:AAPL) has found its match at the negotiating table. That’s why the deal took so much time to consummate, says Cantor Fitzgerald analyst Brian J. White.
With China Mobile, Mr. White believes that Apple Inc. (NASDAQ:AAPL) couldn’t attach the special bells and whistles it demands with an iPhone agreement. In most deals, Apple Inc. (NASDAQ:AAPL) requires companies to buy specific quantities and favor iPhones over other devices. But China Mobile’s size of about 760 million subscribers might have given the Chinese company enough power to come down hard at the negotiation table. On the other hand, Chinese consumers crave Apple Inc. (NASDAQ:AAPL)’s products, so China Mobile would clearly benefit from the deal as well.
According to Cantor Fitzgerald, the iPhone maker was waiting for the Chinese government to issue 4G licenses. China Mobile and its smaller rivals were awarded 4G licenses on Wednesday. Sources told the Wall Street Journal that China Mobile would start offering iPhones to its customers starting December 18. It will give Apple Inc. (NASDAQ:AAPL) access to a customer base that is seven times larger than that of Verizon Wireless.
Mr. White believes that a larger size iPhone will further provide growth opportunity for Apple. There are currently about 35 million to 40 million iPhone users on China Mobile’s network. It gives Apple Inc. (NASDAQ:AAPL) dual opportunity of attracting new users as well as enticing current users to upgrade in 2014. Cantor Fitzgerald thinks that Apple Inc. (NASDAQ:AAPL) could sell 20 million to 24 million iPhones to China Mobile
Investor confidence in Apple is also increasing as the company appears poised for a strong holiday quarter. After falling significantly from late 2012 through the early part of this year, Apple's stock has been rebounding during the second half of 2013, setting a new 52-week high yesterday following a roughly 10% surge over the past two weeks. Like White's reasoning for strong Apple Barometer performance, the recent Apple stock spike has coincided with evidence of strong consumer interest in the company's products for the holiday shopping season, as well as the potential culmination of an iPhone deal with China Mobile, the world's largest carrier.
Supply Chain Performance Points to Blockbuster Holiday Quarter for Apple
Friday December 6, 2013 7:28 am PST by Eric Slivka
In a new research note published today, Cantor Fitzgerald analyst Brian White shares data from his "Apple Barometer" for the month of November, with strong increases hinting that Apple will see blockbuster performance for the holiday quarter. White's metric, which tracks performance of Taiwanese suppliers known to be heavily reliant on Apple, has seen record performances for both October and November.
With approximately 97% of the sales now accounted for in our Apple Barometer, we estimate sales in November rose by approximately 19-20% M/M and well above the November average of up 6% over the past eight years. As such, we believe this November will prove to be the strongest in the history of our Apple Barometer. [...]
Given the combination of a record October performance and our expectation of record growth in November, our Apple Barometer is on track to report stronger-than- average seasonality in 4Q:13. If we assume an average MoM sales decline of 10% in December, we estimate our Apple Barometer will grow sales by 28% QoQ in 4Q:13, or more than double the average increase of 13% over the past eight years.
White attributes the strong performance by Apple's supply chain to robust demand for Apple products such as the new iPhone and iPad models, with an iPhone production boost to support a launch on China Mobile in the coming weeks perhaps also contributing...(more)
UPDATE: Citigroup Reiterates on Apple on Strong Holiday Outlook
Dwight Einhorn, Benzinga Staff Writer December 06, 2013 10:24 AM
In a report published Friday, Citigroup analyst Glen Yeung reiterated a Neutral rating on Apple (NASDAQ: AAPL , and raised the price target from $530.00 to $580.00.
In the report, Citigroup noted, “Apple shares have moved substantially upward of late, following their typical pattern surrounding the Thanksgiving holiday (Apple typically has outperformed the S&P500 by 500bps the 10-days surrounding Thanksgiving), and reflecting the strength of iPhone 5S sales since launch and the forthcoming China Mobile deal. However, our most recent work suggests Apple may have modestly lowered production forecasts for 1Q14. And while not enough to warrant an estimate revision from us (we are 9.7% below consensus on iPhone unit shipments), from current levels we nonetheless suspect downward pressure on Apple shares is likely in 1Q14. While our estimates remain unchanged, our PT is revised to $580 from $530 as we shift our valuation to 2015 estimates.”
watch for mammoth fy14 revenue estimate revisions from the street once the "new deal" with china mobile is officially announced.
Cantor Fitzgerald, analyst Brian White is forecasting calendar 2014 iPhone sales of 20 million to 24 million on China Mobile.
ISI analyst Brian Marshall, for example, is looking for more than double that 17-million-unit figure. He’s calling for iPhone sales on China Mobile of 38.7 million for calendar 2014, with seven million sold in Q1, 8.7 million in Q2, 10.5 million in Q3, and 12.5 million in Q4.
the china mobile deal. watch for some mammoth after hours volume crosses between value and growth mutual funds.
note: this post was translated from english into french and then back into english again.
ubs was the first to call for a market multiple expansion for apple from fourteen to the s&p 500 average of sixteen but with china mobile on board the market must now adjust back to growth peers @ twenty-one times.
based on last months numbers that's $11 billion dollars losing in ballooning margin short accounts add todays up-tick loss of $125 million dollars on only ten million shares, shorts have to start covering before the close or we will crush you tomorrow morning on the gap-up when the china mobile rumor is widely disseminated as a "done deal".
jus sayin amigos
across the board 2014 apple estimates and targets will be raised once "The New Deal" from china is officially announced.
the market must now address apples hyper-growth revenue opportunity in china with a p/e of twenty-one.
it's a denial of service attack marissa should do something about it NOW!
anywho hi marissa hows the baby doing? and what does he like to do for fun so far?
sorry my bad. $50 billion debt notes @ record 2013 low rates serviced by free cash flow. putting apple back on uber-growth trajectory and p/e multiple expansion.
google is blacklisted in china, baidu owns 89% of her market search traffic, and with china mobile a "done deal" apple is now the far east conquistador.
make it so captain cook