BofAML: Apple's iPhone prices could increase 20% under Trump's plan

Sep. 10, 2018 10:42 AM ETApple Inc. (AAPL)AAPLBy: Brandy Betz, SA News Editor86 Comments

Bank of America Merrill Lynch estimates that Apple’s (NASDAQ:AAPL) iPhone prices would increase up to 20% if the company assembles in the US like President Donald Trump wants.
On Saturday, President Trump tweeted that Apple should manufacturer its products domestically to avoid his proposed Chinese tariffs.
The tweet came a day after the release of Apple’s letter to U.S. trade representative Robert Lighthizer, which said the newly proposed tariffs would affect the Apple Watch, AirPods, Mac mini, and Apple Pencil.
BofAML analyst Wamsi Mohan’s estimated price increase would pertain to Apple moving 100% of final assembly to the US, which would require a higher price to offset the labor costs.
Mohan finds it more likely Apple would move 10% of iPhone assembly to the US, which would raise the iPhone ASP by 8%.
Mohan reiterates his Buy rating and $250 price target on Apple, a 13% upside to Friday’s close.
Apple shares are down 1.9% to $217.16.
Previously: Trump says Apple should shift production to U.S. to avoid China tariffs (Sept. 10)