Rosenblatt throws in the towel on AAPL coverage

Posted:
in AAPL Investors edited January 2020
The most bearish Apple analyst on the Street is parting ways with Rosenblatt Securities, and as a result the firm said it will be ceasing its coverage of the iPhone maker.

Jun Zhang appearing on CNBC in September 2019
Jun Zhang appearing on CNBC in September 2019 to talk about Apple being behind in 5G


In a note seen by AppleInsider Rosenblatt has terminated coverage of Apple because Jun Zhang is no longer with the firm. Zhang's predictions for Apple stock pricing have trailed reality -- sometimes by more than $100 -- for about four years.

In April 2016, Zhang said that if the iPhone 7 didn't have a "panel upgrade," there would be no other feature upgrade possible to drive demand. But, the note acknowledged "camera upgrades, speaker upgrades, a home-button upgrade, and some software upgrades" were probable for the device.

As early as May 2017, Zhang predicted that what was ultimately became the iPhone X was suffering from Touch ID supply problems -- a feature not on the iPhone X -- and wouldn't ship until the first quarter of 2018.

Later, in 2017 and 2018, Zhang didn't appreciate Apple's growing Services business at all, and didn't see it as a material addition to the company's revenues going forward.

Following the release of the iPhone 11 lineup in September 2019, Zhang continued to not see the buffering effect on earnings that Apple services provides to offset the impact of a staggered iPhone launch. At the time, he was solely concerned about iPhone sales sustainability, and the difficult compare of the timing of the launch from the previous year.

Furthermore, he said that "we do not believe AirPod shipments will grow in a meaningful way." In actuality, Apple has seen significant imbalances in demand to availability of the AirPods Pro since launch, and Apple CEO Tim Cook says that this will continue for the foreseeable future.

Later, in October 2019, Zhang claimed that Apple's guidance of $87.5 billion only suggested "slight iPhone revenue growth."

"With the earlier launch of new iPhone models and the upcoming production of the iPhone SE2, we do not think slight [year-over-year] growth from iPhone revenues will bring much excitement," said Zhang at the time.

Zhang's last Apple note on January 24 raised the Apple target price to $250. At the time, Apple stock was trading at $320 per share.

Apple is not the only company that the firm is no longer covering, with Qualcomm, Synaptics, and Viavi Solutions all on the chopping block as well. At this time, it isn't clear why Zhang left Rosenblatt.
watto_cobra
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Comments

  • Reply 1 of 43
    MacProMacPro Posts: 19,500member
    Don't hit the door on the way out ....
    TomEallmypeoplecincyteechiagilly33pscooter63jbdragonleavingthebiggflyingdpFred257
  • Reply 2 of 43
    mike1mike1 Posts: 3,024member

    At this time, it isn't clear why Zhang left Rosenblatt.

    Probably because his "analyses" have been consistently wrong.
    mwhiterandominternetpersonjbdragonleavingthebiggn2itivguyviclauyycjony0JFC_PAd_2chasm
  • Reply 3 of 43
    The naysayers on Apple have been the worst
    lkruppn2itivguycornchipwatto_cobra
  • Reply 4 of 43
    SoliSoli Posts: 10,033member
    At this time, it isn't clear why Zhang left Rosenblatt.
    I can wager a guess.


    cincyteechiaretrogustogilly33mwhitelordjohnwhorfinpscooter63randominternetpersonGG1Rayz2016
  • Reply 5 of 43
    BebeBebe Posts: 145member
    Left the company? Or, got the pink slip :D .
    jbdragonn2itivguywatto_cobra
  • Reply 6 of 43
    Bebe said:
    Left the company? Or, got the pink slip :D .
    In a nice way....he got canned like a sardines or in a harsh way HE WAS FIRED
    jbdragonn2itivguywatto_cobra
  • Reply 7 of 43
    kudukudu Posts: 44member
    What they said ⬆️
    n2itivguycornchipwatto_cobra
  • Reply 8 of 43
    If they canned all the incompetent analysts, would there be any left?
    Anilu_777mwhitelordjohnwhorfinn2itivguycy_starkmanviclauyycleavingthebiggcornchipFileMakerFellerwatto_cobra
  • Reply 9 of 43
    lkrupplkrupp Posts: 10,038member
    So this firm will no longer cover the most valuable, most profitable, most talked about company (Apple) in the world? Not important enough for them? What sort of investor does this outfit service? Anybody know?
    randominternetpersonanantksundaramflyingdpn2itivguyjony0cornchipFileMakerFellerwatto_cobrabadmonk
  • Reply 10 of 43

    At this time, it isn't clear why Zhang left Rosenblatt.
    In other words : "A discussion on the reasons he may have left is left as an exercise to the reader"
    lordjohnwhorfinpscooter63n2itivguyleavingthebiggcornchipFileMakerFellerktappewatto_cobrabadmonk
  • Reply 11 of 43
    SoliSoli Posts: 10,033member
    lkrupp said:
    So this firm will no longer cover the most valuable, most profitable, most talked about company (Apple) in the world? Not important enough for them? What sort of investor does this outfit service? Anybody know?
    I have to assume they'll hire someone else to cover tech companies in the coming months.
    watto_cobra
  • Reply 12 of 43
    DAalsethDAalseth Posts: 2,214member
    Soli said:
    lkrupp said:
    So this firm will no longer cover the most valuable, most profitable, most talked about company (Apple) in the world? Not important enough for them? What sort of investor does this outfit service? Anybody know?
    I have to assume they'll hire someone else to cover tech companies in the coming months.
    Except from the article
     
    <blockquote> Apple is not the only company that the firm is no longer covering, with Qualcomm, Synaptics, and Viavi Solutions all on the chopping block as well. </blockquote>

    Makes me wonder. What would people say if a company like this decided to stop covering GM, and just for good measure Delco, Champion, and Goodyear as well. I would like to think the market would decide they had lost their minds, would stop trusting them, and there would be a stampede for the exits. 
    edited January 2020 Carnagecornchipwatto_cobra
  • Reply 13 of 43
    It’s not surprising. These companies that provide analyst reporting lump companies into different segments so they can contrast and compare providing investors their version of where to put their money. Apple doesn’t really fit into any of their current segments. It’s a stupidly simplistic 19th century methodology being used in the 21st.
    gilly33n2itivguywatto_cobra
  • Reply 14 of 43
    mystigomystigo Posts: 151member
    I wonder how much money he cost people who listened to him. Could you image shorting Apple because he thought it was going to $250? There are probably people that did.
    randominternetpersonJFC_PAcornchipwatto_cobra
  • Reply 15 of 43
    If he’s been significantly wrong for 4 years he’s not that good, clearly. I’d say Rosenblatt got rid of him. 
    watto_cobra
  • Reply 16 of 43
    gilly33gilly33 Posts: 402member
     At this time, it isn't clear why Zhang left Rosenblatt.” Maybe they got rid of his miss the mark forecasting butt. 
    watto_cobra
  • Reply 17 of 43
    SoliSoli Posts: 10,033member
    mystigo said:
    I wonder how much money he cost people who listened to him. Could you image shorting Apple because he thought it was going to $250? There are probably people that did.
    They may be pissed, but it's still their fault for putting all trust into someone who didn't have a good track record. If they didn't do the research and instead decided to blindly listen to him then that's on them. I used to ignore my brokerage firms calling me to solicit advice but I finally just answered and politely told them that I do not want them to reach out to me again regarding stocks. I did recently reach out regarding a low-interest loan against my holdings and was given good advice about an LAL (Liquidity Access Line). It's extremely low interest with no LIBOR added for their special. The only negative is that it was still like pulling teeth to get all the information, which had the positive effect of reminding me that I'm better off doing most of the research myself.
    mark fearingcornchipwatto_cobra
  • Reply 18 of 43
    welshdogwelshdog Posts: 1,834member
    Anilu_777 said:
    If he’s been significantly wrong for 4 years he’s not that good, clearly. I’d say Rosenblatt got rid of him. 
    Well maybe Samsung is no longer paying to undermine Apple.  No disinformation dollars, no salary for Zhang, bye bye now. 
    mark fearingcornchipwatto_cobrabadmonk
  • Reply 19 of 43
    Of course Zhang and/or the Rosenblatt Co. might have made millions for themselves betting against his predictions - a reverse "Pump & Dump" scheme as it were.

    Perhaps the SEC might look into their trading history?
    watto_cobrabadmonk
  • Reply 20 of 43
    We're going to pretend the most valuable company in the world does not exist, because we're a serious financial company.
    randominternetpersonrich gregoryleavingthebiggcornchipwatto_cobra
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