Barclays: June quarter iPhone sales to benefit from carrier promos and foreign exchange rates

Barclays is out today with fresh analyst note with estimates on both short and long-term AAPL performance. While the report predicts positive news for the June quarter and 2018 overall, analyst Mark Moskowitz and company have concerns about what 2019 will bring.

Looking at the near-term, Barclays sees three positive factors influencing Apple’s June quarter results: carrier promotions for iPhone in the US and China, foreign exchange rates, and the new free iCloud storage trial offering.

Moskowitz notes that while US wireless carriers are offering BOGO deals and up to $700 off on iPhone 8/8 Plus and iPhone X, China is also offering heavier subsidies than what came along with the iPhone 7.

As for foreign exchange rates, Barclays believes the US dollar depreciating 4% YoY for the June quarter could also benefit AAPL performance if the USD stays about the same.

Lastly for short-term growth, the note mentions the new iCloud storage trial help boost the company’s services. However, that was just recently launched, so it may take some time before we see that offerings influence.

As for the long-term, Barclays has some concerns. It increased its earnings per share estimate 2% for 2018 to $12.25, but lowered it 1% for 2019 to $12.77.

The note rates AAPL as neutral with a target price of $175, which is down about 5% from the current trading price of $184.

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