Mizuho maintains Buy rating on Apple (NASDAQ:AAPL).
Price target of $120. Implied upside is 18.7%.
"We are reiterating our Buy rating and $120 price target despite continued cautious commentary from the supply chain.
"We think iPhone shipment numbers will continue to vary on a quarterly basis and iPhone 7 cycle will likely not be as big as iPhone 6, while it still remains to be seen if it can grow over iPhone 6s.
"However, if we look at LTV of iPhone customers and assume modest growth in the installed base, we think the stock should be worth in the $120-130 range even if iPhone 7 units end up being lackluster initially. We expect supply chain data points to inflect on the positive side starting late spring/early summer."
Mizuho's Japan team sees production down 18% to 206M units in 2016, due to weaker expectations around iPhone 6 sales, and because they don't see iPhone 7 as a huge hit.
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