Apple (AAPL), the high-flying darling of Wall Street that’s up more than 35% so far this year, took a hit this week as traders digested reports of weak demand and production cuts for the iPhone 8.
A Taiwan-based newspaper reported Apple slashed orders for the iPhone 8 and iPhone 8 Plus by about 50% for November and December, prompting some investors to question whether Apple will report disappointing sales for the current quarter. And comments from the chief executive of Rogers Communications, Canada’s largest wireless carrier, did little to calm traders’ fears of soft demand. During the company’s quarterly earnings call on Thursday, CEO Joseph Natale said appetite for the iPhone 8 had been ‘anemic.’
Shares of Apple tumbled on the news, with the stock recording its biggest drop in two months. Despite the widespread worry on Wall Street, not all analysts were concerned. In fact, Drexel Hamilton analyst Brian White doubled down on his bullish call on apple, urging investors to buy into the iPhone 8 ‘doom and gloom’ ahead of the tech giant’s iPhone X release in November.
In a note to clients, White wrote, “Apple’s stock is weak on the back of media reports around order cuts for the iPhone 8/8 Plus and we would be aggressive buyers of the stock with the iPhone X cycle kicking off next Friday with pre-orders.”
Global demand for the iPhone X will be key for Apple. With a $999 price tag, it’s the company’s most expensive phone and could potentially offer a big lift to the tech giant’s holiday-quarter earnings.
White’s the most bullish Apple analyst on the Street with a $208 price target, implying the stock will rally about 33% from Thursday’s close. According to Bloomberg, Apple’s average price target is $179 a share.
Apple was last trading up 0.5% at $156.79 a share.