Wall Street analysts are in two camps about Apple's (AAPL) upcoming iPhone 8 launch. One group believes the 11th-generation smartphone will launch in the company's traditional September window but with limited initial supply, while the other group thinks it will be delayed by weeks because of production snags.
XAutoplay: On | OffBMO Capital Markets analyst Tim Long says Apple's rumored OLED-screen iPhone will be "on time, but limited." In a note to clients Sunday, Long said the new handset, which he calls the "iPhone Pro," probably will see supply shortage "stock-outs" into the first half of calendar 2018.
Apple won't lose iPhone sales because of the shortages; they will just be postponed, Long said. He rates Apple stock as outperform with a price target of 170.
Apple gained 1.2% to close at 152.09 on the stock market today. It was down a fraction in after-hours trading.
"We are lowering our estimates for September quarter guidance and are now $300 million below the Street on revenue, owing to our view that initial shipment volumes of the premium iPhone Pro will be limited," Long said. "However, we believe production capacity will ramp steadily, and we are taking our fiscal 2018 unit and average-selling-price estimates higher."
Apple is scheduled to report financial results for the June quarter, its fiscal third quarter, and give September-quarter guidance on Aug. 1 after the market close.
IBD'S TAKE: Apple stock has been forming a flat base with a buy point of 156.75 over the last 10 weeks. Apple has an IBD Composite Rating of 80, meaning it has outperformed 80% of stocks in key metrics over the past 12 months. For more information, visit the IBD Stock Checkup.
On Monday, RBC Capital Markets analyst Amit Daryanani adjusted his Apple estimates to reflect a "more pronounced" delay for the next iPhone, which he calls the "iPhone X."
"Based on incremental supply chain data points that suggest a more pronounced OLED iPhone delay, we think the flagship device may not see initial shipments until October (vs. mid/late September for historical new iPhone launches) with volume shipments not occurring until the November/December time frame," Daryanani said in a report.
He rates Apple stock as outperform with a price target of 168.
Also Monday, DigiTimes reported that Apple has set up an OLED panel production line in Taiwan as a research-and-development project. Apple wants to develop technology to differentiate its products from chief rival Samsung, which is supplying OLED displays for the iPhone 8, DigiTimes said.