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IPhone Customer's Buying Intent Jumps As New Model Release Looms

AAPL | July 31, 2017

UBS analyst Steven Milunovich previously detailed his “Pig in a Python” theory regarding Apple Inc. (NASDAQ: AAPL)’s upcoming iPhone cycle — explaining that demand has been swelling for the iPhone 8 since 2015. Just recently, an independent survey seems to be backing up that view.

Milunovich reiterated a Buy rating on the stock and $170 price target (see his track record here).

‘Consumers Excited’ About New iPhones

451 Research conducted a smartphone survey of over 4,000 North American consumers on their intent to buy a new device in the next 90 days.

The survey “provides positive data points for Apple,” said Milunovich.

Intent to buy an iPhone was the highest for June since 2010, with a strong, 90-percent retention rate to boot.

Apple is also gaining share of consumer purchasing intent, rising three points from March to 11.3 percent of those surveyed planning to buy an iPhone in the next 90 days. Samsung lost 3 points over the same period.

Among all consumer planning to purchase a new phone, Apple took the lion’s share with 52 percent, a 14-point jump.

The survey noted particular interest among consumers looking into devices with large screens.

Although the survey looked strong for Apple, Milunovich expects uncertainty for fiscal 2018 to remain in Q4 this year, and will be looking to guidance for a sense of when the next iPhones will launch.

Apple will report its earnings for the third quarter on Tuesday after the close.

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