Don't believe all those nattering nabobs of negativity about Apple's future, says Katy Huberty. Ahead of Apple's earnings coming up on May 2, the influential analyst is feeling increasingly good about iPhone sales, and believes that Apple's most expensive phone, the iPhone 7 Plus (the one with the dual cameras), is selling at a higher proportion of total iPhone sales. And that, she believes, is shown in the average selling price for an iPhone, for which she has raised her estimate to $753 from $715. Consensus among other Apple analysts is $675.
Huberty is also feeling much better about the availability of the super-bright OLED displays that will go in Apple's next high-end phone, to be announced this fall. The upshot is that Huberty has raised her stock-price-to-earnings ratio on Apple to 14X for 2018, the highest and most bullish estimate since the heyday of Apple's last mega-hit, the iPhone 6. Huberty believes Apple will sell between 260 million to 264 million iPhones next year.
Huberty's projections are somewhat surprising given the headwinds facing Apple's new phones, likely announced this spring. Global smartphone sales are on a downward curve, component suppliers are pumping out less product, and the iPhone faces arguably greater pressure than ever from Samsung's top end phones. On the other hand, the hype cycle around the "iPhone 8" seems more overheated than ever. MS