Morgan Stanley: Apple’s multiyear iPhone upgrade cycle is a ‘when, not an if’

Apple’s A18-powered iPhone 16
Morgan Stanley analyst Erik Woodring says iPhone shipping times don’t carry the predictive power some analysts and investors assume, and he continues expect a big surge in iPhone demand over the near term.
Martin Baccardax for TheStreet:
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“Historically, first-two-week lead times are directionally predictive of next-12-month shipments at the model level, but they don’t provide much insight into December-quarter iPhone build revisions or total iPhone shipments,” Woodring said in a note published Tuesday.
Woodring reiterated his ‘buy’ rating and $273 price target on Apple stock, a level that suggests 26% upside for Apple over the next 12 months.
“What’s more important is how iPhone 16 lead times trend over the next 10 days,” he added. “We see near-term stock downside to $200, which we’d be buyers of, given that the multiyear upgrade cycle is a ‘when, not an if,'” he added.
CFRA senior equity analyst Angelo Zino also argues that early iPhone lead times aren’t a reliable indicator of demand, noting the small sample size and time horizon that could skew the dataset.

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MacDailyNews Take: Yup.
You cannot measure demand based on shipping times without knowing how much supply Apple has in hand (also vs. the previous year compare with iPhone 15 Pro supplies being constrained due to camera component yields) and where and how those supplies are allocated in each geographic area.
We’ll take panicked dips that are wholly unsupported by solid data every single day of the week! – MacDailyNews, September 17, 2024

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