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Canaccord analysts cut the firm’s price target on Apple (NASDAQ:AAPL) to $170 from $200 per share in a note Wednesday, telling investors they expect a sluggish start for the tech giant in 2023.
“While production of the higher priced iPhone 14 Pro and 14 Pro Max improved exiting the December quarter, we maintain our below consensus estimates for Q1/F2023 and full year F2023,” wrote analysts, who maintained a Buy rating on the stock.
Even though the firm believes demand is solid and some of the lost December quarter sales will help March results, they also anticipate an overall sluggish start to F2023 consistent with its below consensus estimates.
“With the overall concerning macro backdrop for consumer spending on higher-priced devices, we have reduced our overall hardware estimates for F2023 and F2024 with most of the reductions stemming from our lowered iPad and Mac estimates,” explain the analysts.
Canaccord’s Q1/23 iPhone revenue estimate is $68.3 billion, compared to the FactSet consensus of $69.3B, while its F2023 estimate of $199.6B is below the consensus of $205B.
“With the share underperforming since its September quarter earnings report, we believe the share price has likely priced in a slower start to F2023. With the 5G upgrade cycle still likely to benefit iPhone sales longer-term combined with other hardware categories growing the installed base and mix of new subscribers to drive faster growth for high-margin services, we reiterate our BUY rating,” the analysts concluded.
Apple shares are trading 1% higher on Wednesday.
