“JMP Securities analyst Alex Guana on Wednesday downgraded his rating on Apple Inc. stock because of a slowdown at its primary manufacturer in Japan,” Silicon Valley / San Jose Business Journal reports.
“‘We don’t know the cause of the Hon Hai deceleration, but possible causes could include simply in-line iPhone sales due to more significant Android competition, weakness in computing products as tablet demand grows, and/or product risk around the iPad 2,’ Gauna said,” Silicon Valley / San Jose Business Journal reports. “Not many analysts apparently share Gauna’s concerns so far. Factset shows that of the 54 ratings on Apple, 93 percent of analysts rate it at ‘buy’ or ‘overweight.'”
Full article here.
Tiernan Ray reports for Barron’s, “Gauna’s note is not really about last week’s earthquake very much at all, but rather about a possible disappointment in Apple’s March-quarter report that was building for some months. In any event, ‘After a five-year track record of beat and raise an average of 23% [at Apple], we should take note of the deceleration,’ says Gauna.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “Brawndo Drinker” for the heads up.]
Interesting action. I never heard of Alex Gauna, the “analist” at JMP but as of 1/10/11, Sam Wilson had upgraded Apple’s price target to $400 with an Outperform rating. Prior to that he’d upgraded to $335 on 9/28/10 with an outperform rating.
I’m certain Mr. Gauna has done copious research to come to his conclusion today. What a joke.
…especially curious since yesterday Deutsch Bank reiterated their Buy rating and $440 target, and J. P. Morgan has an Overweight rating and $450 target. The median target is still somewhere around $420, I think.
More BUY opportunities ahead! My Auto-BUY triggers have already fired once this week already.
Yipee! Load up. It won’t be down here long. Buy low sell high.
Guano is just full of it.
Guano: excrement (feces and urine) of cave dwelling
insectivorous bats, seabirds, and seals.
Pffft… the loser is conveniently forgetting Hon Hai has many large customers. Could it have been one of them reducing production?
YES!!! It is a “slowdown” with the crap that people no longer want. Who would want a crappy Windows Netbook when they could get an iPad2?
Idiots. Soon, if they were not making something with an Apple logo on it, they would be laying of people every day!
If these assemblers are not making that Windows crap, they can focus on making stuff for Apple! The only reason Apple could not sell more iPads in the past was because they could not get them made fast enough. PROBLEM SOLVED!
LOL! Honhai is a Taiwanese manufacturing giant operating largely in China! It has nothing to do with Japan at all. Either Gauna is an idiot or the article misrepresented him. Either way, ridiculous FUD.
Not so fast. Many components (e.g. Li-Ion batteries, NAND flash memory) and manufacturing materials (e.g. lubricants, solvents) are made in Japan and imported unto China. The effects of the quake/tsunami, nuclear power plants shutdown (affecting up to 30% of the country’s electricity supply) is still not entirely known.
Just-In-Time Logistics is practiced by nearly all manufacturers, so there us some validity to the analyst’s caution. But I do agree that it’s largely due to the supply not keeping up with demand. Now more so than ever.
Apple products, that is. 🙂
Yup. My WiFi iPad2 16G just showed up at the front door. Ordered Friday 3:00am CST delivered Wednesday 11:30 am CST. A day early. I feel sorry for those folks who are going to have to wait weeks. I think Apple jumped the gun on this one. In the future you can bet that they will rethink their product launches. And that’s not factoring in the disaster in Japan which is in some way going to affect product manufacturing for Apple. It simply has to. Maybe greatly or moderately but it will be a factor. And in reality my iPad isn’t that important. The people in Japan are important. We should always keep things in perspective. They need our support.
Agreed.
Just to be clear, the consensus is Hon Hai (Foxconn) forecast is NOT linked to Apple’s growth. Merely coincidental thus far.
But just look at the article. He’s talking up a supposed slow down in Honhai even before the tsunami and presenting the company as Japanese, which is absurd. By the same token what about downgrading Honhai’s other partners, such as HP? And totally missing is a discussion of Honahai’s massive new plant construction inland in China, in Henan and Sichuan provinces. Hardly the act of a company whose growth is slackening.
Agreed. The spin is suspicious.
Some suppliers to Apple, reportedly Sony Chemical among them, have plants in areas affected by the triple carastrophe. The report I read didn’t say if the plants were damaged or just shut down due to so much generating capacity being off line.
You cannot run a factory if you cannot ship your product, your workers cannot come in and are experiencing rolling blackouts-especially with the just in time
inventory system. The same thing that keeps it lean makes it vulnerable to disruption.
LOL! Honhai has nothing to do with Japan. It’s a Taiwan company operating largely in China. Either Guana is a clueless idiot or the article betrays sloppy journalism. Either way, a silly downgrade.
That’s the Facts, Jake
If components come from Japan the factory that needs them is SOL.
Isn’t he named after bird feces?
Can you say ‘stock manipulation?’
I knew that you could.
Yes. But it’s making me Money.
Just manip0ulation, making an opportunity for buyers and themselves. Just like before the release of th iPad2, two unkown analysts from two unknown taiwanese companies, “advised” the market that the ipad2 was facing major delays. Result, share price came down sharply and those guys make a lot of money when the official anouncemnt came out. Pay no attention to analysts!!!
I’d love to se this jive turkey put his money where his mouth is and go bust when the numbers prove him incompetent. Chicken.
Here comes some skittishness again. If Apple gets downgraded and they’re kicking everyone’s butts as if they’re a startup, what happensmto the rest of the market?
Stock manipulation? More like Securities Fraud.
mission accomplished for guano. The cornhuskers can now unload their shorts of the long derivatives. Tomorrow the MM will pull this up. New weeklies will be priced. Shyters will short the long derivatives. Next Wednesday, another guano comrade will issue another ridiculous research. The cornhuskers cleanup again.
Hon hai does not have apple as it’s sole customer. Hon hai slowed down because of NOKIA, Dell, hpq. Not apple. LOL, the supply of iPad 2s cannot even keep up. Guano is shameless. Ifvhe mentioned the other customers of hon hai, then I might have some respect for him. This definitely was unethical.
The new MO of hedge funds and money “managers” is to rbi g the stock down with FUD up till two minutes before earnings. That’s when they get in for the spike and then they sell when the tide turns.
There’s got to be a way to burn the bastards, other than Apple continuing to leave everyone in the dust.
What are they gonna say when iPad is as ubiquitous as TV…?
…is to bring the stock down with FUD up till two minutes before earnings…
“Rather interesting supply chain related news came from Apple, Inc. circles this week. According to the Wall Street Journal, (paid subscription may be required) Apple plans to begin producing a CDMA version of its widely popular iPhone later this year. This move would allow other carriers such as Verizon Wireless or Sprint Nextel Corp. to offer iPhones to their subscribers. Currently, Apple offers only a GSM version with an exclusive distribution arrangement with AT&T.
According to this article, Apple is about to embark on a dual contract manufacturing strategy for the iPhone. Sources close to Apple are indicating that production of the newer CDMA version will be sourced to Pegatron Technology Corp., the contract manufacturing arm of Taiwan based ASUTeK Computer Inc. Apple also plans to upgrade the current GSM version being produced by contract manufacturer Hon Hai Precision Industry Co. The Journal notes that sources that one person familiar with the situation indicates that Pegatron is scheduled to start volume production in September, but the schedule could change. As is the usual practice, representatives from both contract manufacturers have declined to comment.”
The above from an article of April 2010 would explain slowdown in growth of Hon Hai. Decline likely associated with PCs/Net books for other companies.
Interestingly Cramer on CNBC in response to a caller re APPLe yesterday made a comment that he expected a downgrade “tomorrow”.
Word was out ahead of time, likely explaining the weakness in Apple near market close.
One more thing:
With all the gloom predicted, if there’s one market that will thrive, it will be the mobile communications market that is essentially the live wire and lifeline that keeps the world connected.
There’s no doubt that iPhones, iPads, and all FaceTime capable devices rule that space and demand for these will only grow and be more appropriate with time. Apple has multiple sources for all components and manufacturing in place already and is better positioned than anyone to muster any economic and supply chain downturns. At the end of the day Apple will thrive through thick or thin.
Who in the frikking world is JMP Securities analyst Alex Guana, and why should it matter what he predicts. Is he somehow related to nostradamus? Why do idiots keep downgrading a perfect stock? They should be fired for this!
Morons.
Guano is bat-shit crazy… 🙂
No reason to look for a rational explanation, it’s just more FUD, more stock manipulation. But we can sleep easy, the SEC will again come down hard on the scammers. Not.
Consider that it isn’t a reflection on Apple or demand, but on supply as related directly and indirectly to the situation in Japan.
How much you want to bet this guy is WRONG!!!!
He’s saying a slow down in sales, I seriously doubt it.
May lying, cheating, scheming dirtbag stock traders the world over burn in everlasting Hell. Not applicable to honest, forthright stock traders, if there are any.
I bought a few more shares of aapl. Will buy if it gets knocked down more.
Don’t know about Batshits numbers but it seems speculative e.g Hon Hai’s lack of growth = apple’s. Maybe but then as Batshit himself points out Apple is only 25% of Hon Hai’s production, maybe it’s all the other tablets, droid phones etc that are getting their azz kicked. Maybe a whole bunch of rival tablets guys just cancelled… ?
Anyhow even if Apple is doing not as good currently I do know Apple has good prospects: the iPad 2 is selling like crazy, no visible competition of note, (production not meeting demand is BETTER than no demand and production issues WILL get fixed). As for the iPhone: it’s great now but eventually it’ll get 4G etc: so when that happens what is the advantage of droid phones? Malware? IPhone will just chew them up little by little.
I remember ‘analysts’ similar to Batshit:
you know the “missing iPhones ” story, the “iPhone screens will fail in one year from heat layer disintegrating” story, “Antennagate”.
The iPhone heat layer story knocked aapl down a lot and was completely fabricated by a Nomura International “Analyst”:
seeking Alpha 2007:
“Reports of non-responsive spots on the iPhone’s touch-screen raise concerns over the device’s long-term viability, an analyst told clients in a note Friday. Nomura International analyst Richard Windsor said the iPhone’s screen makes use of a chemical reaction to provide touch sensitivity based on heat. The technology, he said, was bought from a defunct Finnish company that had attempted to produce a similar device, but gave up after finding the chemical film began to degrade and lose its sensitivity after extensive use. Windsor said the problem typically appeared within 3-6 months. Apple was likely aware of the problem and should have fixed it, he wrote, but said only time will tell whether all is well with the iPhone touch-screen.”
IPhones of course do NOT use heat technology but touch capacitance (which I pointed out in various blog comment sections in 2007). The whole report is B.S. ( I think Windsor is STILL covering Aapl as an analyst.) After that report came out -iPhone screens will fail in months! – aapl tanked and that was a buy opportunity.
(please note for newbie aapl investors: I’m not saying aapl won’t fall any more now or no risk, all stock investing is risky and aapl tends to gyrate a lot up and down. for me I just bought more)
Where the hell is the SEC when this kind of crap is going on? This guy Guana needs to be hauled out in handcuffs for what is clear and blatant market manipulation.
Apple stock is getting a pretty good beat down right now, which may continue for some time. The market is selling off broadly and is very volatile. My holding and counter-cyclical holdings are all down, which means even good stocks are being dumped for cash or bonds right now.
Apple is /- $30 from recent highs, so long term buyers might want to keep a close watch on it.
Never heard of these guys. I have heard of Credit Suisse who just raised their projections of Apple to $500 for 2011.