Apple Inc. price target of US$190 reiterated at UBS as its analyst deems iPhone’s price strategy ‘successful’ | Proactive Investors

Despite recent price weakness at Apple Inc. (NASDAQ:AAPL), analysts at UBS are sticking by their price target of US$190 a share for the iPhone maker’s shares.

Apple shares have taken a nearly 8% hit in the last five days amid weaker numbers reported last week by Taiwan Semiconductor Manufacturing Co. (NYSE:TSM), a big Apple supplier. UBS noted the supplier’s miss has sparked fears that Apple will report disappointing iPhone sales in June, but its analysts say they are not convinced the miss “is only a reflection of iPhone end demand.”

“Consequently, we think June units may end up closer to 40mn (million) than 35mn,” according to the UBS report dated 24 April 2018.

And while there appear to be “a lack of upside catalysts” at Apple, the UBS analysts said “the downside also appears limited, with strong services growth likely and a significant stock repurchase to be announced.”

Analysts deem Apple pricing strategy ‘successful’

UBS acknowledged there “has been little good news regarding iPhone demand given continued supply chain concerns” and question marks in China. Nonetheless, the analysts maintain that Apple “is having success moving buyers up the iPhone price curve.” They estimate that 24% of customers paid more than US$900 for their iPhones, up from only 5% a year ago.

“We think Apple’s pricing strategy has worked better than most investors believe,” the analysts said. “A moderate mix-down is evident, but Apple successfully moved most premium customers in the US$700-US$900 price range to price bands over US$1,000.

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Apple Inc. price target of US$190 reiterated at UBS as its analyst deems iPhone’s price strategy ‘successful’.