CLSA warned clients on Tuesdsay that the market is still too bullish on shares of AAPL based on lower fourth quarter expectations and 1Q18 numbers that are unlikely to improve. A recent report from Taiwan's Economic Daily claimed that Apple's first quarter forecasts for the iPhone X have been slashed to 30 million from 50 million.
"We maintain that 2017 fourth-quarter iPhone X volumes were at 30 to 35 million and we are very skeptical that volumes will increase in the first quarter of 2018," CLSA analyst Nicolas Baratte wrote in an note Tuesday. "This does not reconcile with the expectation of pent-up demand or push-out to the first quarter of 2018 in our opinion: consumers who wanted to get an iPhone X in December 2017 already have it."
Baratte believes that analyst expectations of over 35 million iPhone X units sold in Q1 'will prove too high'.
In contrast, Piper Jaffray has reiterated an overweight rating for AAPL with a price target of $200 following a recent survey of iPhone users.
"Our survey of 400 iPhone buyers indicates that iPhone X and iPhone 8 mix is similar to our expectations, increasing our confidence in average selling price assumptions for the current quarter and FY18," he wrote on Tuesday. "Our iPhone average selling price assumption of $720, therefore, appears achievable, increasing our confidence in revenue and earnings per share estimates."
Both Baratte and Olson say a price cut could be an option if sales volumes are lower than Apple would like.
"We expect a lower priced X-gen option (likely the current iPhone X with a price cut) and we wouldn't be surprised to see a 'plus' X-gen model in 2018," added Olson.