Morgan Stanley sees Apple's strong holiday sales continuing into 2015

Posted:
in AAPL Investors edited January 2015
Apple is expected to announce yet another quarter of record sales next week, a trend that investment bank Morgan Stanley believes will continue throughout the spring as demand for the iPhone and Mac remains strong alongside the long-awaited release of the Apple Watch.




In a Tuesday morning note to investors, a copy of which was provided to AppleInsider, Morgan Stanley technology analyst Katy Huberty said that the bank foresees iPhone shipments for the holiday quarter falling between 67 million and 69 million units. The iPhone's average selling price is expected to climb to $667 --?a 5 percent year-over-year uptick -- thanks to stronger demand for the higher-priced iPhone 6 Plus and an increase in consumers opting for devices with larger storage capacities.

Some 5.8 million Macs are thought to have been sold in the just-completed quarter, which would mark a new record high for the recently-resurgent computer lineup. Folding in a predicted 22 million iPad sales on top of older product lines, such as the iPod, would bring revenue to nearly $69 billion on 38.7 percent gross margin for the frame.

Going forward, the bank believes Apple is prepared to ship more than 50 million iPhone units through March as they increase inventory range to between 5 and 7 weeks. The Mac will likely maintain its over-5-million-per-quarter pace, while the iPad comes with a more grim forecast, as supply chain indications point to target production of just 11 million devices.

Huberty argues that Wall Street remains "too pessimistic" about the Apple Watch's potential, and forecasts shipments of 3 million units adding $1.4 billion in revenue for the March quarter. The uncertainty around sales of the wristworn device and recent exchange rate fluctuations --?notably in Russia --?could affect Apple's spring revenue, she wrote.

Overall, Huberty remains optimistic about Apple's future. She maintained the bank's overweight rating and $126 price target for AAPL shares.
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Comments

  • Reply 1 of 46
    Seems like a good overall analysis. I think Watch will sell well, but not enough for analysts with a grudge against Apple.
  • Reply 2 of 46
    freerangefreerange Posts: 1,584member
    Excuse me but "shipments for the holiday quarter falling between 67 million and 69 million units" would be much better said to be RISING to between 67 - 69 million!
  • Reply 3 of 46
    bobschlobbobschlob Posts: 1,074member
    Stupidest use of the word "falling" ever. What about "hitting"?
  • Reply 4 of 46
    Quote:

    Originally Posted by FreeRange View Post



    Excuse me but "shipments for the holiday quarter falling between 67 million and 69 million units" would be much better said to be RISING to between 67 - 69 million!

     

     

    Quote:

    Originally Posted by BobSchlob View Post



    Stupidest use of the word "falling" ever. What about "hitting"?

     

    Holy cow, calm down. Ever heard of the phrase "let the cards fall where they may"?

  • Reply 5 of 46
    Then Morgan Stanley are wrong.

    By holiday, they mean Christmas, but are using weaselly politically-correct language. We are now post-Christmas, so, by definition, Apple cannot continue their Christmas sales.
  • Reply 6 of 46
    pistispistis Posts: 247member

    Now they are arguing over insanely improved sales. Cool, as an Apple share holder this is fantastic. If and when the iPhone sales go over 70million or higher just watch the stock price. I'm selling the rest of my holding if it hits $130 and moving on.

  • Reply 7 of 46
    pistispistis Posts: 247member
    Quote:

    Originally Posted by BobSchlob View Post



    Stupidest use of the word "falling" ever. What about "hitting"?

    Don't you have something better to do than argue about semantics?

  • Reply 8 of 46

    It's hard to tell by Apple's recent share price movement that Apple is selling anything or doing anything positive at all.  It still seems as though the big investors have no interest at all in owning Apple no matter what the company does or offers to shareholders.  All of Apple's efforts seem to have met with a collective Wall Street "Meh!"  There's nothing Apple can do to impress Wall Street.  I'm still half-expecting to hear "Apple's holiday quarter disappoints investors."

  • Reply 9 of 46
    mpantonempantone Posts: 1,348member
    Quote:
    Originally Posted by Benjamin Frost View Post



    By holiday, they mean Christmas, but are using weaselly politically-correct language. We are now post-Christmas, so, by definition, Apple cannot continue their Christmas sales.

    There's Hanukkah as well. You do recall that we have mentioned to you before that there are people who aren't Christians on this planet, yes? Or are you still living in your own dreamworld bubble?

     

    Orthodox Christians celebrate Christmas in January, this year on January 7 because they use the Julian Calendar (not Gregorian).

  • Reply 10 of 46
    MacProMacPro Posts: 17,835member
    Seems like a good overall analysis. I think Watch will sell well, but not enough for analysts with a grudge against Apple.

    Exactly. Or if Apple blow it out the park in ?Watch sales Analysts will worry Apple won't be able to maintain the supply or some such nonsense, so either way APPL will suffer with such morons.
  • Reply 11 of 46
    MacProMacPro Posts: 17,835member
    Then Morgan Stanley are wrong.

    By holiday, they mean Christmas, but are using weaselly politically-correct language. We are now post-Christmas, so, by definition, Apple cannot continue their Christmas sales.


    Unknot your knickers. I'm pretty sure that the wording of the headline did not mean "Continue holiday (whatever name you wish) sales" literraly, rather it surely meant '.. continue at the same level as ..said holiday sales.'
  • Reply 12 of 46
    Quote:

    Originally Posted by Steffen Jobbs View Post

     

    It's hard to tell by Apple's recent share price movement that Apple is selling anything or doing anything positive at all.  It still seems as though the big investors have no interest at all in owning Apple no matter what the company does or offers to shareholders.  All of Apple's efforts seem to have met with a collective Wall Street "Meh!"  There's nothing Apple can do to impress Wall Street.  I'm still half-expecting to hear "Apple's holiday quarter disappoints investors."


     

    What?

     

    Compare AAPL with MFST, GOOG or IBM over the last 3 months. Somebody seems to be buying Apple shares because the price has risen over 10%, besting the other 3 by a good margin... and you can bet that AAPL will continue to rise over the next couple of months... it will just depend on Cook's forward statement.

  • Reply 13 of 46
    dasanman69dasanman69 Posts: 12,969member
    Unknot your knickers. I'm pretty sure that the wording of the headline did not meant "Continue holiday (whatever name you wish) sales" literraly, rather it surely meant '.. continue at the same level as ..said holiday sales.'

    Since they've only recently caught up with demand the sales after Christmas could be attributed to people finally getting a iPhone after waiting so many months, and not necessarily because of the holidays.
  • Reply 14 of 46



    File this under No S. Sherlock....

  • Reply 15 of 46

    Katy securing the first question for Tim after earnings once again!

  • Reply 16 of 46
    Quote:

    Originally Posted by mpantone View Post

     
    Quote:
    Originally Posted by Benjamin Frost View Post



    By holiday, they mean Christmas, but are using weaselly politically-correct language. We are now post-Christmas, so, by definition, Apple cannot continue their Christmas sales.

    There's Hanukkah as well. You do recall that we have mentioned to you before that there are people who aren't Christians on this planet, yes? Or are you still living in your own dreamworld bubble?

     

    Orthodox Christians celebrate Christmas in January, this year on January 7 because they use the Julian Calendar (not Gregorian).


     

     

    And it’s now January 20th, so we are past the Orthodox Christians' Christmas, too.

     

    My point stands.

  • Reply 17 of 46
    Quote:

    Originally Posted by digitalclips View Post

     
    Quote:

    Originally Posted by Benjamin Frost View Post



    Then Morgan Stanley are wrong.



    By holiday, they mean Christmas, but are using weaselly politically-correct language. We are now post-Christmas, so, by definition, Apple cannot continue their Christmas sales.






    Unknot your knickers. I'm pretty sure that the wording of the headline did not meant "Continue holiday (whatever name you wish) sales" literraly, rather it surely meant '.. continue at the same level as ..said holiday sales.'

     

     

    Guy here; no knickers to unknot.

  • Reply 18 of 46
    Quote:
    Originally Posted by mpantone View Post

     

    There's Hanukkah as well. You do recall that we have mentioned to you before that there are people who aren't Christians on this planet, yes? Or are you still living in your own dreamworld bubble?

     

    Orthodox Christians celebrate Christmas in January, this year on January 7 because they use the Julian Calendar (not Gregorian).


    Jewish population is ~2% of US population, and Orthodox Christians < 0.5%. Not sure that the aggregate numbers there matter a whole lot.

     

    Quote:
    Originally Posted by sog35 View Post

     

    Chinese New Year is in Feb


    This is probably far more important....

  • Reply 19 of 46
    Quote:

    Originally Posted by sog35 View Post

     
    Quote:
    Originally Posted by Steffen Jobbs View Post

     

    It's hard to tell by Apple's recent share price movement that Apple is selling anything or doing anything positive at all.  It still seems as though the big investors have no interest at all in owning Apple no matter what the company does or offers to shareholders.  All of Apple's efforts seem to have met with a collective Wall Street "Meh!"  There's nothing Apple can do to impress Wall Street.  I'm still half-expecting to hear "Apple's holiday quarter disappoints investors."


     

    No stock goes straight up no matter how well they are doing.

     

    IMO the recent stock drop from $119 to $105 was because of Yearly Options Expiration last friday.  With that out of the way I expect this to blow pass $120 and to $140 by end of the year.

     

    Wall Street was impressed by Apple the last 3 quarters.  THATS WHY THE STOCK IS UP 116% SINCE ITS LOW IN 2013.


     

    And 8% since its high in 2012.

     

    Yippee.

  • Reply 20 of 46
    Quote:

    Originally Posted by sog35 View Post

     
    Quote:
    Originally Posted by Benjamin Frost View Post

     

     

    And 8% since its high in 2012.

     

    Yippee.


     

    It was over-valued in 2012 at $702.  You can always point to a moment in time when buying a stock yields horrible returns.

     

    Wall street always does this.  They go through a rotation of under-valuing and over-value a stock. There goal is to fool retail into buying high and selling low.  With all the hype in 2012 they probably fooled a bunch of people to buy shares at $650-$700.  And then fooled them again to sell when they tanked the stock to $385.

     

    Look a Google now.  They had a high of $615.  Now its at $515.  I think Wall Street will tank this to $400 to scare retail into selling cheap.


     

     

    Agreed.

     

    I think Google is very over-valued.

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