Apple's Foldable Phone Faces Challenges Ahead of Launch
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3 days ago
0mins
Should l Buy AAPL?
Source: Yahoo Finance
- Delayed Innovation: Apple is entering the foldable phone market late, with plans to launch its first foldable iPhone in September at a price exceeding $2,000, indicating its focus on the high-end segment despite the technology being available since 2019.
- Technical Challenges: The company is reportedly facing design and durability issues, yet the foldable iPhone is expected to be a significant product for attracting users, particularly in China, where demand for foldable smartphones is rapidly increasing.
- Ecosystem Advantage: Apple's loyal customer base enhances the potential for the new product to become a bestseller; although interest in foldable phones is low among U.S. consumers, the interconnectedness of Apple devices and high-margin services will further lock in users.
- Market Outlook: While analysts suggest that the introduction of the foldable iPhone alone may not drive Apple stock purchases, its high price point and potential for user upgrades could boost sales, especially in China, the largest market for these devices.
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Analyst Views on AAPL
Wall Street analysts forecast AAPL stock price to rise
27 Analyst Rating
17 Buy
9 Hold
1 Sell
Moderate Buy
Current: 258.830
Low
239.00
Averages
306.89
High
350.00
Current: 258.830
Low
239.00
Averages
306.89
High
350.00
About AAPL
Apple Inc. designs, manufactures and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related services. Its product categories include iPhone, Mac, iPad, and Wearables, Home and Accessories. Its software platforms include iOS, iPadOS, macOS, watchOS, visionOS, and tvOS. Its services include advertising, AppleCare, cloud services, digital content and payment services. The Company operates various platforms, including the App Store, that allow customers to discover and download applications and digital content, such as books, music, video, games and podcasts. It also offers digital content through subscription-based services, including Apple Arcade, Apple Fitness+, Apple Music, Apple News+, and Apple TV+. Its products include iPhone 16 Pro, iPhone 16, iPhone 15, iPhone 14, iPhone SE, MacBook Air, MacBook Pro, iMac, Mac mini, Mac Studio, Mac Pro, iPad Pro, iPad Air, AirPods, AirPods Pro, AirPods Max, Apple TV, Apple Vision Pro and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Product Line Expansion: By introducing lower-priced products like the MacBook Neo, Apple is actively expanding its user base, while plans for a competitive iPhone Fold could further increase market share, positioning the company for future growth.
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- Diverse Revenue Streams: With over 2.5 billion active devices, Apple offers various subscription services including music and video streaming, which provide a growing source of recurring revenue, enhancing its cash flow stability and risk resilience.
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- Dividend Growth Potential: Although Apple's dividend yield is only 0.4%, its 82.5% growth over the past decade and a conservative 15.6% cash payout ratio indicate the company has room for further increases, making it attractive for retirees seeking stable income.
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- Capital Return Strategy: All of Berkshire's top ten holdings pay dividends, with Coca-Cola yielding an impressive 63% annually, reflecting Abel's continuation of Buffett's focus on capital returns to enhance shareholder value.
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- Capital Return Strategy: All of Berkshire's top ten holdings feature robust capital return programs, with each company paying dividends; Coca-Cola boasts an impressive 63% annual yield, underscoring Abel's dedication to maintaining shareholder value.
- Long-Term Holding Strategy: In his first shareholder letter, Abel classified Apple and Moody's as 'indefinite holdings,' indicating confidence in their long-term prospects, despite Berkshire having sold approximately 75% of its Apple stake in the past two years.
- Value Investment Principle: Both Abel and Buffett emphasize the importance of securing good deals, as evidenced by Berkshire's recent reductions in holdings, reflecting sensitivity to market valuations, particularly when bank stocks trade above book value.
See More
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- Revenue Record: The company's revenue reached NT$1.134 trillion (approximately $35 billion) in Q1, surpassing the market expectation of NT$1.127 trillion and reflecting a 35% year-on-year growth, showcasing TSMC's strong performance in the global semiconductor market.
- Advanced Process Growth: TSMC's high-performance computing division, which includes AI and 5G applications, accounted for 61% of total revenue in Q1, while advanced chips of 7 nanometers or smaller made up 74% of total wafer revenue, highlighting the company's competitive edge in the high-end market.
- Capex Guidance Raised: TSMC now expects its capital expenditures for 2023 to reach the high end of its previous forecast, between $52 billion and $56 billion, reflecting a 37% increase and indicating the company's optimistic outlook on future demand amid global energy supply uncertainties.
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- China's Economic Growth: China's GDP grew by 5% in the first quarter, exceeding economists' forecast of 4.8%, as reported by the National Bureau of Statistics, showcasing the resilience of the Chinese economy despite potential global demand shocks from the Iran conflict.
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