14 DAY TRIAL // Apple has finally managed to iPhone X production with demand, and while the device could soon become available for walk-in customers, analyst forecasts aren’t at all optimistic.
Nomura Instinet analyst Jeffrey Kvaal said in a note to investors that Apple’s stock might no longer grow beyond the existing point, despite the production struggles with iPhone X being resolved.
Kvaal has also downgraded Apple stock from buy to neutral, which as Bloomberg notes is the first time AAPL is being lowered since June.
“We argue that the stock’s gains for the iPhone X supercycle are in the late innings,” Kvaal explained. “We believe unit growth, if not quite Average Selling Price growth, is well anticipated by consensus and a historically full multiple.”
The analyst also explained that Apple’s Services unit, which has become a more important cash cow for the company, is unlikely to help increase stock price in the coming months.
The $1 trillion value goal
Does this mean that Apple might no longer be able to surpass the $1 trillion market value as originally expected? If things do no improve on the iPhone X front, this is unlikely to happen, despite 2017 itself being quite a successful year for the company and 2018 initially projected to be even better.
Earlier this year, Apple passed $900 million market value for the first time, and analysts expected the iPhone X to help the company reach the $1 trillion threshold sometime next year.
Performance of the iPhone X, however, appears to be impacted not only by the original stock issues, but also by the high price point of the device. The base model costs $999 in the United States, while the top version with 256GB storage can be purchased for $1,049.
The controversy caused by some changes made to the iPhone X is also said to be responsible for the sales below expectations, including the introduction of a facial recognition system that completely replaces fingerprint sensors on the device.