Morgan Stanley notes that as of Tuesday, September 17, four days after pre-orders started, Apple iPhone 16 lead times have doubled from last Friday and are longer internationally than in the U.S., but are still tracking lower year-over-year. However, lead times as a proxy for demand this early have “little predictive power,” contends the analyst, who argues that the trajectory of lead times in the next 10 days is more important. First two-week lead times are directionally predictive of next 12 month shipments at the model level, but not for December quarter iPhone build revisions or total iPhone shipments, adds the analyst, who sees near-term stock downside of $200 and would be buyers given the firm’s view that a multi-year upgrade cycle is “a when, not an if.” Morgan Stanley maintains an Overweight rating and $273 price target on Apple shares.
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