Apple stock slides on Credit Suisse claims of iPhone component order cuts, weak iPhone 6s demand

“In an intra-day note to investors, Credit Suisse analyst Kulbinder Garcha said recent checks with Apple’s Asia supply chain revealed weaker iPhone orders than previously forecast, reports Street Insider,” Mikey Campbell reports for AppleInsider. “Following the note’s release, Apple stock prices declined to close at $117.34, down from a $118.73 open.”

“‘In our view, the continued weak supply chain news could weigh on Apple shares for the next few weeks/quarters,'” Garcha writes, adding that unexpectedly low iPhone 6s demand appears to be driving the cuts,” Campbell reports. “Credit Suisse issued a nearly identical report three weeks ago, saying Apple cut supply chain orders on weak iPhone 6s demand.”

Campbell reports, “The investment bank’s Asia team supposedly confirmed a further decrease in orders for November, informing new build estimates of 70 to 75 million units for the December quarter and 45 to 50 million units for the three months following.”

Read more in the full article here.

MacDailyNews Take: We pity anyone who risks their cash in the market without understanding the games that are played on a consistent basis.

Investors should never forget that the sole qualification for becoming a Wall Street analyst is getting hired as a Wall Street analyst.

Like I have explained in the past this is a commission generating note issued by the analyst so as to provide the brokers at Credit Suisse a reason to call their clients to sell/add/buy shares of Apple as the case maybe.

The calls from the brokers to their clients would be something along the following lines:

• To a client that is already long the broker would say, “our analyst just found out some information not yet out on the Street and he says shares will remain weak for weeks and quarters and you should sell yours hares in Apple and buy XYZ instead.”
• To a client that has no position in Apple, the broker would say, “our analyst just made a great call on Apple and the shares are down around $3 per share and I know you have wanted to buy Apple and here is your opportunity. He still has an Outperform on the stock with a $140 price target.”

So, what the analyst did here is come out with a negative note that will get the shares moving, in this case lower (matters not actually) and allow the brokers to call their clients and ask them to buy/add/sell as the case may be.

It’s called an “actionable” research report in the business. — Jay Somaney, Forbes, November 10, 2015

Those who are interested in actually analyzing companies vs. fomenting low-information investor sentiment against them, are those who listen to what Apple’s management tells them:

Even if a particular data point were factual it would be impossible to accurately interpret the data point as to what it meant for our overall business because the supply chain is very complex and we obviously have multiple sources for things, yields might vary, supply performance can vary. The beginning inventory positions can vary, I mean there is just an inordinate long list of things that would make any single data point not a great proxy for what’s going on. Apple CEO Tim Cook, January 23, 2013

SEE ALSO:
UBS analyst’s latest ‘research’ note on Apple is just another ‘actionable’ note and should be totally ignored – November 16, 2015
Apple shares continue to get slammed on commission/bonus related ‘actionable research’ – November 10, 2015
Apple lower after Credit Suisse notes substantial supply-chain cuts – November 10, 2015

12 Comments

  1. Meanwhile, TDK’s CEO is hinting that company will be producing even more iPhone high-frequency filter components next year. Ya’ don’t like one rumor, wait five minutes for the next. And hold on to your wallet.

  2. This BS note was put out 2 weeks ago and the “re-release” of this drivel is simply ANOTHER analist scam……yes: apppppple is doooomed….nobody willl buyyy anything…..Samdung has market share…………..
    oh sorry…..Apple has 94% of smartphone profits; and I’ll go with the GS call on Apple last week…..
    Never mind $200 billllllion in the checking account….ummmmkay!!

    1. “Apple stock slides.” I guess they meant upwards? Oh the need for hype and “looks/clicks” that create income. Is this not just the Facebook-azation of America, where “likes” are the symbol of success/value? Time to lay my head down–this kind of redundancy tires me out.

  3. All around me I hear people talking about getting new iPhones. In the past week, I have talked to friends and family who are upgrading from feature phones, android phones, and older iPhones, all during this holiday season. Several were also buying iPads. A couple asked me about Appe TV and the watch.

    Apple has a huge, complex, and convoluted supply chain, difficult for some Suisse Mole to ferret accurate info from. Yet, the emotionally driven market listens to a questionable FUD report that may well be intended to create volatility and some churn to the benefit of a few Wall Street traders, instead of trusting their own personal observations of those around them flocking to Apple products this holiday season?,

  4. Somebody’s really worried about Apple’s blindsiding of Xmas retail…
    Can it be Google, or Amazon, or Samsung, or hedgies or ATT or anyone else that can’t innovate to compete???

    Hahahahaha

  5. Desperate attempt by Credit Suisse to drive more transactions on AAPL before year end 2015; they do not care whether customers buy/sell AAPL, as long as transactions occur. Manipulation by Financial Institutions at its worst!!

  6. As Apple has said many times in there meetings they change vendors and suppliers all the time. Just because orders slip from one does’t mean anything. Anyone that has walked into an Apple store during this current holiday season will see there are no shortage of customers buying products including 6s and 6s Plus phones. Credit Suisse is trying to make something from nothing because they are trying to read between the lines and that is a very bad thing to do with Apple.

  7. It’s another Swiss bank spewing out some shite about Apple. The Swiss are a tight bunch. Watchmakers hurt, so banks try to get a little pay back… Swiss banks are no great examples themselves, having been forced to rat out their foreign investors. It ain’t the good ole days any longer Little country in the mountains trying to stay relevant in modern times.

  8. Whatever is going on, AAPL is stagnant. My shares are up $3 in the past year, this is atrocious. If the stock gets above $120 I’m strongly considering selling all of my shares and investing in something that will give me a decent return. I like Apple and they’re doing a lot of great things, but apparently it isn’t good enough and I’m not going to wait around. Whether it’s analysts or poor management or the stars being aligned in the wrong way, AAPL has been a dog of an investment for the past year when they should have been going gangbusters.

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