Apple Unlikely to Give June Quarter Guidance on Thursday: J.P. Morgan

The move could drive shares lower in the short-term but the investment bank remained positive on Apple’s long-term outlook.
Publish date:

Heading into its closely-watched March quarter earnings report on Thursday, tech giant Apple  (AAPL) - Get Report is unlikely to give its usual guidance for the current quarter since most of its retail stores outside of China remain closed, J.P. Morgan wrote in a note on Monday morning.

“Given limited visibility on store operations, refraining from issuing specific guidance for F3Q should not come as a surprise to investors and will be consistent with recent precedent by other companies,” analyst Samik Chatterjee wrote.

As a result, Chatterjee wrote that he expects the current buy-side expectations of 25-28 million iPhone sold in the current quarter will be adjusted lower, putting pressure on shares after the report.

But given his strong long-term outlook for Apple, Chatterjee wrote that “we would recommend investors to look to add incremental positions following consensus recalibration after the print to participate in the 5G iPhone volume cycle and Services transformation upside.”

J.P. Morgan reiterated its overweight rating on the stock and its Dec. 2020 price target of $335.

Apple shares were falling 0.9% to $280.60 on Monday morning. The Wall Street Journal reported Monday morning that Apple will delay mass production of its flagship iPhones but still move ahead with plans to release new models later this year, likely in September. Shares are down about 5% year to date.

In a separate note on Sunday, Chatterjee and his team noted that delivery lead times for the new low-cost iPhone SE, which began shipping on April 24, appeared to show healthy global demand, although some caution was warranted given potential logistics delays.

Apple is a holding in Jim Cramer’s Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells AAPL? Learn more now.