Apple (AAPL) - Get Report shares are taking a hit Friday, but even after the tech major posted disappointing fourth-quarter results, Wedbush analysts reiterated their buy rating and $150 price target on the stock.
At last check the Cupertino, Calif., company's shares were off 5.7% at $108.80.
Wall Street should not be shocked that the company's iPhone numbers were light as the launch of its newest version came four to six weeks later than usual this season, according to Wedbush analyst Daniel Ives.
"With preorder activity tracking more than 2 times vs. the iPhone 11 a year ago based on our analysis from Asia suppliers, [the] iPhone 12 is off to a robust start out of the gates and should translate into a massive holiday quarter for Cook & Co. with clear supercycle-like momentum into 2021," Ives said.
The shares are dropping after Apple said iPhone revenue came in at $26.44 billion, down more than 21% from a year earlier. The latest figure was just off the Street forecast of $26.5 billion, thanks in part to the late launch of the iPhone 12. China revenue was also disappointing, falling 29% to $7.95 billion.
Wedbush views the iPhone as a "once in a decade" launch cycle given its estimate that 350 million of the company's 950 million active iPhones worldwide are in the window of an upgrade opportunity.
That fact coupled with the new iPhone 5G compatibility means that investors worried about peak iPhone saturation have misplaced their concern, according to Wedbush.
"Taking a step back, we believe Apple is on the cusp of its largest iPhone product cycle since iPhone 6 in 2014 and we would be buyers on any weakness," Ives said.