Apple Stock Sinks After Analysts Lower iPhone Sales Estimates

Goldman Sachs also cut its iPhone shipment forecasts for this year and next

Karee Venema
Mar 28, 2018 at 9:46 AM
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Shares of Apple Inc. (NASDAQ:AAPL) are trading down 1% at $166.70, after Goldman Sachs cut its iPhone sales estimates by 1.7 million units to 53 million units in the first quarter of the calendar year, and by 3.2 million units to 40.3 million units in the second quarter. The brokerage firm also lowered its iPhone shipment forecast for this fiscal year, which ends in September, as well as the 2019 fiscal year, and dropped its price target to $159 from $161.

Adding additional pressure to Apple shares is a price-target cut to $203 from $205 at RBC, though this still represents expected upside of 20.6% to last night's close at $168.34, and sits in uncharted territory. The brokerage firm also cut its iPhone unit and average sale price expectations for three-month period ending March.

Today's pullback is just a blip on Apple stock's longer-term radar, with the shares up more than 86% from their May 2016 lows. More recently, the shares took a strong bounce off their 50-week moving average during the early February stock market correction -- a trendline that served as a floor in September 2016 -- and hit a record high earlier this month.

Nevertheless, Apple call options are currently pricing in remarkably low volatility expectations compared to puts, per the stock's 30-day implied volatility skew of 14.9% -- in the 97th annual percentile. However, short-term options are still relatively expensive, based on AAPL stock's 30-day at-the-money implied volatility of 27.9%, in the 95th percentile of its 52-week range.

 


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