Apple threatens adversity. (Photo: 360b / Shutterstock)
According to analysts, the corona crisis is expected to put heavy pressure on iPhone sales and trigger a slump in Apple shares. The investment bank Goldman Sachs is now advising to sell.
Closed stores, fewer sales and the limited iPhone production in China due to the corona crisis had already caused Apple in mid-February Lower forecast for the first quarter of 2020. However, analysts see the iPhone group only at the beginning of a longer period of weakness. The investment bank Goldman Sachs, for example, has lowered its forecast for the development of Apple shares for the third time in a row since mid-February Apple insider reports.
Apple stock: analyst advises selling
Goldman Sachs analyst Rod Hall expects Apple’s stock to plunge around $ 283 over the next twelve months. The forecast has been reduced from $ 250 to just $ 233. In addition, Hall has reduced his rating to “Sell” in an investor letter, so recommends a sale of the Apple share. In the period between spring 2019 and spring 2020 – before the corona crisis worsened – the tech giant’s share gained around 130 percent. Part of the recommendation would also include taking profits.
With the warning, Goldman Sachs is in any case the first major bank to remove Wall Street darling from the list of recommendations. Analyst Hall sees the reasons for this as a whole series of challenges that the iPhone corporation could face with the corona crisis, which is likely to be even longer.
Slump in iPhone sales expected
From a macroeconomic perspective, the global forecast decline in gross domestic product (GDP) is weighing heavily on sales, as is the impending recession. This should also decrease the demand for iPhones, as Hall suspects. As in previous crises, consumers fear they could save rather than spend their money. The analyst sees a slump in iPhone sales by the middle of the year, a recovery until 2021 should only occur to a small extent.
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In addition, the analyst could imagine the idea of the new flagship smartphone iPhone 12 delay. A presentation is not expected before November 2020. Hall justifies this warning with international travel restrictions still valid. In the third quarter, Goldman Sachs expects a drop in iPhone sales in 36 percent. The decline is expected to be 24 percent in the first half of the year. Apple boss Tim Cook had recently said positive about the gradual opening of the retail trade.
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