JP Morgan analyst Samik Chatterjee remains bullish on Apple, reiterating an Overweight rating and a $265 price target for AAPL stock. His latest analysis of Apple product availability, known as the Apple Product Availability Tracker, reveals encouraging trends for the iPhone 16 Pro models.
Chatterjee notes that delivery lead times for Pro models, which were initially slower than expected, have stabilized in the third week of his tracking period. This stabilization suggests that the initial weakness in demand for Pro models was likely an aberration. He attributes this to consumers holding back their purchases, anticipating the release of Apple Intelligence, a feature expected to be a major selling point for the Pro models.
While overall lead times for the iPhone 16 series have moderated as expected following the peak in the second week, the Pro models have bucked the trend of decreasing wait times. This is a stark contrast to previous years, where lead times for Pro models typically saw a significant drop in the third week. The analyst believes that the steadiness of Pro model lead times indicates that demand is starting to pick up as the release of Apple Intelligence draws closer.
The analysis further reveals regional trends. In the US, which accounts for about 32% of iPhone shipments, Pro model lead times stabilized while Base model lead times moderated. In China, which accounts for approximately 20% of iPhone shipments, delivery lead times for the 16 Plus dropped drastically and for the 16 moderately, while remaining stable for Pro models. Europe, where Germany and the UK account for roughly 5% each of iPhone shipments, showed similar trends with moderate lead times for Base models and stable lead times for Pro models.
The overall picture suggests that while initial demand for the iPhone 16 Pro models was slower than expected, it is likely to correct itself as consumers become more confident in the product with the approaching launch of Apple Intelligence. This positive development further solidifies Chatterjee’s optimistic outlook on Apple’s future prospects.
