Apple Inc.'s (NASDAQ: AAPL) newly unveiled watch won't plug a hole that could develop if sales of its smartphones see a slowdown, an analyst said Tuesday.
Mizuho's Abhey Lamba called the watch a "niche product" and said Apple's shares will remain closely correlated to performance of its iPhone product line.
Lamba maintained a Neutral rating on Apple and a $115 target. Shares changed hands recently at $125.36, down $1.75.
The strong recent sales performance of the company's iPhones will make for tough quarterly comparisons during the second half of 2015, according to Lamba.
"It's difficult to see upside from current levels," Lamba said of Apple's stock.
Lamba also said his channel checks suggest Apple's iPad Pro won't launch until the second half of 2015, while the company's latest Macbook lineup, also unveiled Monday, will cannibalize a portion of potential tablet sales.
Lamba's comments on the iPad launch schedule correlate with a report last week from Bloomberg that said production won't start until September.
As for the Apple Watch, "we don't expect broad appeal in the near term," said Lamba, who called the device "an interesting complement to the iPhone."
Most of the device's functions require the nearby presence of a linked iPhone.
"A subset of users will find the device very appealing," according to Lamba, but prices starting at $350 are too high for broad, worldwide acceptance.
Latest Ratings for AAPL
|Mar 2015||Evercore Partners||Maintains||Buy|
|Mar 2015||Monness Crespi Hardt||Maintains||Buy|
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