Missed The Short On Apple, No Problem, Short Qorvo
In Apple’s recent quarter, they said they will no longer report unit sales of its main hardware divisions, including iPhone, iPad, and Mac. But Apple is still getting approximately 60% of their revenue from iPhone sales. So how could they leave out such an important detail in the subsequent reports? Nevertheless, more Wall Street analysts are lowering their iPhone sales estimates.
JPMorgan reduced their iPhone sales forecast over the next two years. They reduced their expectations for 2019 by 10 million units to 208 million and for 2020 by 10 million units to 210 million.
Goldman Sachs analyst Rod Hall cut his iPhone sales estimate for Apple's fiscal 2019 by 5.5%. He now expects Apple to sell 202.9 million units in its fiscal year, which started Sept. 30. He previously forecast sales of 214.8 million units.
Hall made the changes after Lumentum Holdings (LITE) on Monday slashed its fiscal second-quarter revenue and profit guidance because an unnamed customer, believed to be Apple, materially reduced its orders. Lumentum makes 3D sensors that power the facial recognition technology on Apple's latest iPhones. Other iPhone parts suppliers have lowered their estimates as well, including Japan Display and Skyworks Solutions (SWKS).
Qorvo, Inc. provides radio frequency (RF) solutions and technologies for mobile device, infrastructure, and defense and aerospace applications worldwide. Qorvo, Inc. They too now expect revenue in their third quarter of $800 million to $840 million, down from its prior target range of $880 million to $900 million. But the kicker is Qorvo gets about 40% of its revenue from Apple business.
So how low will Qorvo stock price go, lets go to the charts?
On the monthly chart price not only did price hit the monthly demand at $85, but also broke out to the downside of the ascending channel.
On the weekly chart, the chart suggests price will fall down to the weekly demand at $42.
On the daily chart, the chart suggests to short Qorvo on a pull back to the daily supply at $70, with a $45 target.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
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by rollandthomas
I'm wary about investing in an apple supplier after I lost my shirt on GT Advance. They will just let their supplier go bankrupt after false promises...
When you are the little guy, unfortunately, you have no leverage over Apple.
Never heard of Qorvo, will have to give it a look!
I'm looking at the leap put options, but the open interest is a bit low.
Leaps tend to be like that on most of the non-big name players. As long as it's no a zero I usually don't worry about it.