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Rosenblatt Warns Apple Investors about iPhone Challenges

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Apr. 29 2019, Published 3:47 p.m. ET

Apple stock

In 2019 so far, tech giant Apple (AAPL) has outperformed the broader market by a wide margin. As of April 26, its stock was up 29.5% year-to-date, compared to 17.3%, 22.8%, and 13.8% gains in the S&P 500 Index, the NASDAQ Composite Index, and the Dow Jones Industrial Average, respectively. In comparison, Alphabet (GOOG), Qualcomm (QCOM), and Microsoft (MSFT) have risen 22.2%, 52.2%, and 27.9%, respectively.

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Rosenblatt warns Apple investors

According to Thomson Reuters, analysts at Rosenblatt Securities believe continuing iPhone XR price cuts are the biggest challenge for Apple. The research firm expects total iPhone shipments in the third and the fourth quarters to fall on year-over-year basis to 39 million and 63 million, respectively. Also, Rosenblatt estimates a massive drop between 5% and 10% year-over-year in new iPhone production in the second half of Apple’s fiscal 2019.

Rosenblatt’s views on Apple came in less than a month after Apple cut prices of its products including iPhones, iPads, Macs, and AirPods in the Chinese market by nearly 6%, CNBC reported citing Apple’s online store in China.

Apple’s Q2 earnings

The iPhone maker is set to release its second-quarter earnings on Tuesday after the market’s closing bell. Wall Street analysts surveyed by Reuters expect its second-quarter revenue to fall 6.2% year-over-year while its adjusted earnings to fall 13.5% year-over-year. Check out Apple’s Earnings Could Fall after Rising for Nine Quarters to learn more.

At 2:20 PM ET, Apple stock was trading at $205.05 with 0.4% gains for the day.

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