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On cue, Apple's (AAPL -2.8%) sell-side fans are defending it following reports of iPhone...

On cue, Apple's (AAPL -2.8%) sell-side fans are defending it following reports of iPhone component order cuts due to weaker-than-expected demand. UBS, one of the first to report of production cuts, says it detects no change to iPhone orders since December, though it worries shares could be pressured near-term. Wells Fargo notes Apple's 65M-unit iPhone 5 display order (per The Nikkei) was "an unrealistic number to begin with." JPMorgan says it only forecast 25M calendar Q1 iPhone 5 builds regardless. Notable Calls: "This sure feels like capitulation, doesn't it?"
Comments (41)
  • You read one report of declined orders which drops the stock, and right under is a headline "Apple Likely to Crush Analyst Estimates w/ 53 Million Q1 iPhone Shipments.
    14 Jan 2013, 11:28 AM Reply Like
    14 Jan 2013, 11:31 AM Reply Like
  • It won't end until Apple becomes a responsible company and takes control of the message...this is all about Apple's Board!!
    14 Jan 2013, 11:38 AM Reply Like
  • Apple was giving some unusual discounts in some retail chains, it was a sign that demand was lower than they were expecting...I guess it's one more sign that the Galaxy S3 is the cool phone now. The new connector just turned the decision easier for those thinking of leaving the Apple's ecosystem. Apple needs to make a killer iPhone 6 and redesign iOS if they want to keep its cash it's the time to see whether Tim Cook can work his magic in the way Steve Jobs did...
    14 Jan 2013, 11:36 AM Reply Like
  • What a poor comment. Are you really sticking by your sentiment??
    14 Jan 2013, 11:39 AM Reply Like
  • Apple was not giving discounts. The stores selling those items were (i.e. Walmart) to bring in customers. I will not address any of your other statements purely because your first sentence shows your complete lack of understanding in this company and investing in general.


    We'll talk again on January 24th first thing in the am.
    14 Jan 2013, 11:49 AM Reply Like
  • He is absolutely right. Tell me the last time Apple offered their newest IPhone at Walmart for $127?


    You can't. AFAIK, The IPhone5 was the first time that has happened.
    14 Jan 2013, 01:06 PM Reply Like
  • Apple is strict about pricing their products at the retail level. Wal-mart cannot unilaterally decide to take the loss and mark the IPhone 5 down to $127 without the explicit permission/support of AAPL
    14 Jan 2013, 01:07 PM Reply Like
  • The new connector? seriously? I bought adapters for $5 each to use my old 30 pin cables. If people are switching to an inferior eco system because of a connector, then good riddance
    14 Jan 2013, 01:10 PM Reply Like
  • It offered only a few at a few stores and ran out in less than a day.
    14 Jan 2013, 01:59 PM Reply Like
  • The counterfeiters have already reverse-engineered and now producing cables for the new connectors. I saw it (and used it just to make sure it sync) with my own eyes.
    14 Jan 2013, 02:19 PM Reply Like
  • The Galaxy S3 being the "cool" phone is all smoke and mirrors. An image molded by the media. But the reality is, the S3 has only sold 15 million units since May. That's pretty pathetic in my opinion. Apple is projected to sell close to 50 million Iphone 5's in a quarter! When will the FUD end?
    14 Jan 2013, 02:21 PM Reply Like
  • Rocback, the perpetual AAPL-bull with rose-colored glasses.


    The facts suggest otherwise. The sale just ended 2 days ago.



    "On Friday Walmart announced that it was cutting the price of the iPhone 5 to $127 for the next thirty days.


    This was an unusual move. Apple typically prevents stores from making drastic price cuts this early in a new iPhone's life cycle."
    14 Jan 2013, 02:23 PM Reply Like
  • Walmart cut their own share of the price, not Apple's share.
    14 Jan 2013, 02:26 PM Reply Like
  • STDvooh.... proof?


    WMT is well-known to bully suppliers on margins, not the other way around. WMT would not eat the costs on IPhones as a loss-leader to that degree. Perhaps at the current $187, but not at $127


    "The discounts WERE ARRANGED WITH APPLE"


    "We worked together with them on this," the spokeswoman, Sarah Spencer, said. "They are a great partner."

    14 Jan 2013, 02:33 PM Reply Like
  • Walmart offered the phone at the expense of its own lost revenue -- a loss leader to get traffic in the store and sell accessories
    14 Jan 2013, 03:59 PM Reply Like
  • Of course but should Apple turn them down on taking a loss to push the iPhone? Are you thinking that?
    14 Jan 2013, 04:00 PM Reply Like
  • Look out - they have limited functionality -- mostly just for charging. Even teh Apple $30 Lightening to 30 pin legacy connector does not work with its legacy 30 pin HDMI adapters. You have to buy the latest Lightening connector for HDMI connection at $50! Adapters are a nice profit center
    14 Jan 2013, 04:02 PM Reply Like
  • Proof? Read the article that you posted a link to, "chopchop0."


    Apple allowed Walmart to lower the price and only Walmart's profit.
    Apple still makes the same profit margin as from any other retailer, and I'm sure Apple would allow any other retailers to lower their own profits and prices too, IF they purchased as many iPhones as Walmart can wholesale.


    Blowing out Apple's old inventory makes sense, if the reported changes in part purchasing orders, presage a new, larger display, World iPhone coming soon, for the international market that will be able to operate on new bandwidths.
    14 Jan 2013, 04:54 PM Reply Like
  • I think many are over-estimating the availability of those deals. Any call to your local walmart will show that the deal is not available.


    During Black Friday, Walmart advertized a Smart LCD TV for 599 or 699. What they failed to tell potential customers was that they only had 7. I saw the line which have over 100 people who all probably bought other high margin tvs instead. That is walmarts strategy and it will be similar with AAPL.
    14 Jan 2013, 04:58 PM Reply Like
  • Still a first in the history of apple. They've never allowed price gimmicks on iPhones and other products until the 5.


    Please spin that positively
    14 Jan 2013, 10:50 PM Reply Like
  • I already did.
    14 Jan 2013, 10:53 PM Reply Like
  • Ok fine I give up. Just to show I am such a nice guy you can sell my car for me for $500 but I get to keep the sticker price of $10,000.


    You won't have to worry, the car is in high demand.
    14 Jan 2013, 11:46 PM Reply Like
  • Samsung sold 40 million units of Galaxy S3, 10 million units in the last 2 months.


    My point with the "cool" factor is that a significant part of consumers, specially in emerging markets, are treating smartphones like a fashion statement, this is pretty dangerous, sales trends can change very fast.
    I am not saying AAPL is overvalued, but I would take any bullish valuation based on significant long term growth with a grain of salt. There is a real risk that sales might start stalling or even drop in the mid-term...
    15 Jan 2013, 08:25 AM Reply Like
  • These analysts need investigating.


    Read somewhere this morning that one analyst claimed last week that imac sales had fallen during the holiday period whereas another stated today that imac sales actually increased over the period.


    They can't all be right!
    14 Jan 2013, 11:37 AM Reply Like
  • The surprising thing is not that analysts defend the stock in the face of these kinds of articles, but rather that sellers continue to succeed in pushing the price down by rehashing these old charges.


    Here's hoping (and believing) that next week's numbers will crush these yahoos. At something like 8 x current year earnings (ex cash), it seems like all kinds of negative outcomes have already been reflected in the stock price, but positive surprises have not. At this point the "risk" would seem to be to the upside.
    14 Jan 2013, 11:37 AM Reply Like
  • As I have mentioned before,the stock is not a raving buy until Maria Bartaromo.declares it dead.Am long AAPL.Broke down this weekend and got the iPhone 5.Cost for 16GB was $200 with a 2 year committment.I asked the fellow who waited on us(after a half hour wait in line)if they were selling a lot of Apple phones.He said that 80% of his sales are Apple.The 5 was only available in black;white all gone.No big deal.I am just afraid that the street's expectations are so high for the quarter that the company will disappoint.No idea how much more piling on can take place.
    14 Jan 2013, 11:38 AM Reply Like
  • Apple is going to blow some minds on its upcoming earnings call in more ways than one. In addition to record iphone sales and profits, expect the following which will take the hedggies, talking heads, short sellers, Apple bashers and MM manipulators by surprise.


    The decision to bring in Luca Maestri as controller is in response to the major stock manipulation that has been going on. He will play the heavy for Oppenheimer. Expect increased stock buy back, stock split announcement and an increased dividend and much more. Apple has been quietly watching, listening and planning its next move. While Cook, Oppenheimer and Jonnie Ives take care of business, they will let Luca lose on the Wall Street manipulators and short sellers who have been trying to scare retail investors and treating Apple stock like their personal yo-yo. Judgement day is coming.
    14 Jan 2013, 11:40 AM Reply Like
  • "Apple has been quietly watching, listening and planning its next move." You say that as if Apple management are like a snake in the grass waiting to pounce on short sellers.


    Any other company would defend their stock rather than see raft of retail investors get fleeced by the 25% drop in the value of their shares.
    14 Jan 2013, 11:53 AM Reply Like
  • But you only get fleeced if you sell.


    Sure I wince at the drop (who wouldn't), but then I simply don't sell....


    Retail traders might be getting fleeced, retail investors (long term holders) are less likely to be.
    14 Jan 2013, 02:12 PM Reply Like
  • You need to be realistic about what they can say one week before the earnings report! The stock price will be back. Its the options holders who are getting screwed this week due to OPEX and market makers wanting to maximize profits
    14 Jan 2013, 04:06 PM Reply Like
  • The market is mad.....the price drops approx 3% because of an anonymous report from an unknown source.....then the respected financial institutions basically say this report is worthless and not factually correct. No rise back up in apple share price. Its sheer price manipulation by these 'sources' in the first report.
    14 Jan 2013, 11:40 AM Reply Like
  • There were several astute comments on the SA articles covering the alleged cut in display demand since yesterday, arguing that Apple ordered 65 M displays last quarter, so if they sold in the neighborhood of 45 M iPhones this quarter (could be more, of course) that would give them parts for another 20 M iPhones for the next quarter. If this is true then they're not in bad shape at all.
    14 Jan 2013, 11:44 AM Reply Like
  • This is not capitulation, this is simply fraud...has anyone ever seen anything about Apple selling 65mm phones in it's second fiscal quarter!? Yes, this was reported in the WSJ, but the source is a very sketchy one, meaning misinformation all the time.


    The problem is this stock is so easy to manipulate, and it's manipulated every day. Doesn't anyone think it's interesting this information comes out about 9 days prior to their quarterly announcement??


    The problem is Apple, but not it's sales. The problem is that Apple let's shills manipulate and control the message on behalf of traders and hedge funds to their benefit. I'm still surprised because of the visibility the SEC hasn't picked this up, but on the other hand I'm not because they are useless.
    14 Jan 2013, 11:47 AM Reply Like
  • maybe, but if People want to be negative they will and then it's useless coming out with a counter message, Apple should not get involved in that, Cook came out for the 1st time ever ( as far as i recall) with one little bit of info " on the first weekend in China sales were 2 mio " and what did that do for the stock or sentiment ?
    i like Apple as a company , i do not like the behavior of its stock price
    ( i am short Apple )
    14 Jan 2013, 11:59 PM Reply Like
  • I checked with our field office in Korea (the function of the field office is not mobile phone related) with 15 people. Out of the 10 people below 35 years old, 7 of them have iPhone. This is very high percentage of iPhone ownership, considering it is in Korea, which is Samsung's turf. Some other staff told me that the reason they bought Samsung phone is due to their function of sales call at Samsung. In Korea, bring an iPhone to a Samsung office is not "politically correct".


    This is just another indication that iPhone is doing well!
    14 Jan 2013, 11:48 AM Reply Like
  • Component order cuts are most likely due to design changes for new iPhone products. New product announcements are coming.


    I'm bullish on AAPL.
    14 Jan 2013, 12:15 PM Reply Like
  • ... and new displays from Innolux Corp.(Taiwan’s biggest makers of liquid-crystal displays) with "in-cell"- technology will replace displays for 5s. (German)
    14 Jan 2013, 02:21 PM Reply Like
  • Do the math! Buy ALL YOU CAN AT $500 (Market cap at 4 x cash!!!)


    What do these numbers rumours mean. Good or Bad for Apple.


    The iP5 did not get released until early November, and was not rolled out worldwide until early December (including into 50 completely new countries). Therefore at most 1.5 months of selling in 4Q.


    So, if Apple put 65m into production for the 4th quarter, with another 35m (according to the rumour mill) for the 1st quarter 2013 then that gives Apple some 100m units for about 4.5 months. Considering Apple sold 52m iPhones (3gs, 4 and 4s) in Q4/2011 and Q1/2012 combined, and they have put 100m iPhone 5's into production for Q4/2012 and Q1/2013 then if we factor in the existing sales of the still strongly selling iPhone 4s then (unless I can not add up) all signs point to a really huge Q4/2012 & Q1/2013 with something like 100m or more iPhones being sold in the two quarters. This will be almost double the same period a year earlier.


    It will smash the estimates, and if we factor the strong App Store, iPad mini (increased production from 8 to 12m units) and new iPad sales it looks like Apple will deliver extremely strong 4th Quarter results.


    Try to ignore the noise. Use this period as an opportunity to load up and wait for the facts next week. Buy now. AAPL could just as easily trade up 4% tomorrow as shorts get nervous. The fundamentals are after all clear and obvious for all to see.
    14 Jan 2013, 12:30 PM Reply Like
  • Whether it is iPhone or iPad, Apple has always initially experienced low-yield issues especially for its screens. While anticipating the product introduction and holiday sales in December, they have no choice but to order more than what was necessary, at a premium price if necessary (ie. having component price cut into its margin), and even that wasn't enough because of the huge order backlog that didn't clear for almost a month. But once they achieved the quantities needed, they tried to diversify and seek cheaper component makers and that (in my opinion) was what happened back in 12/12/2012 when it cut component orders, as part of its supply chain strategy.


    Going forward, we'll see more suppliers, but handling fewer orders than their capacities allows. Some suppliers (like Samsung which produces Apple component) to cease to do business with Apple, but new suppliers added (Intel, TSMC are two leading contenders). This will result in the supply chain being more balanced, diversified, and its bottlenecks reduced. The same will hold true for the distribution channels as they add more carriers (China Mobile, NTT, etc.), more stores and enter new countries.


    This (management of supply chain) will effectively improve gross margin, revenue and EPS, for Q2-2013 and beyond.
    14 Jan 2013, 03:13 PM Reply Like
  • The "on cue" is a somewhat snide and cheeky way of showing SA's bias (actually Jhonsa's bias) against pro-AAPL news. The "on cue" adds nothing journalistically and mocks the analysts in a soft but clear way. Shameful but I guess that's why many (like me) are defecting.
    16 Jan 2013, 05:30 AM Reply Like
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