“Investment bank Goldman Sachs cut its price target on Apple Thursday to reflect lower growth expectations for the smartphone industry,” Spriha Srivastava reports for CNBC. “This follows a recent reduction of the bank’s global smartphone unit growth forecast for 2016 to 5 percent from 6 percent, and to 4 percent from 7 percent for next year.”
“The bank has trimmed its price target to $124 from $136, maintaining a ‘buy’ rating,” Srivastava reports. “Goldman also trimmed predicted iPhone unit sales to 211 million from 212 million for the whole of 2016.”
“The bank further said that the reductions were driven by lower market growth, as well as lower average selling prices on a greater shift from developed to emerging markets. It expects this to drive more sales for the new lower-priced iPhone SE, relative to the higher-priced iPhone 7,” Srivastava reports. “On a brighter note for Apple, Goldman said the consensus on full year 2017 sales is too low as pent up demand will likely coincide with iPhone 7 upgrades… ‘We continue to view consensus estimates for (full year 2017) as too low, as we expect an increase in upgrades with the iPhone 7 based on the pent-up demand evident in our recent U.S. consumer survey, combined with our estimate of 26 percent year-on-year growth in the iPhone installed base as of September 2016.'”
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MacDailyNews Take: This too shall pass.