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Analyst predicts far-reaching consequences
Fiscal years 2020 and 2021 are also at risk
New assessments
In mid-February, Apple made a negative announcement regarding the March quarter, citing supply chain constraints and weak demand due to the COVID 19 outbreak. As a result, Needham analyst Laura Martin lowered its second and third quarter earnings expectations for Apple. As a result, EPS estimates for the first and second quarters fall from $ 2.99 and $ 2.76 to $ 2.47 and $ 2.44, respectively. Meanwhile, the company’s sales outlook for 2020 will decrease from $ 282.92 billion to $ 268.76 billion. However, analyst Laura Martin stuck to a buy recommendation and a target price of $ 350 for the Apple share.
Far-reaching effects
In the new estimates for the iGroup, the analyst now assumes that normal supply and demand will only resume around June, two months later than previously assumed. However, Martin makes it clear that the spread of the virus could have far-reaching effects. She is concerned that the impact of the epidemic on supply and demand, which will continue after June, could have dire consequences for the company. Martin sees new product launches in particular and the Christmas sales season exposed to a greater threat than initially thought. Because in the past three years, new products in the fall and sales in the Christmas season accounted for around 32 percent of Apple’s annual sales. According to Martin, if the corona virus had a negative impact on sales during this period, this would also have negative effects for the 2020 and 2021 financial years.
Editorial office finanzen.net
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