By Senad Karaahmetovic

BNP Paribas Exane analysts downgraded Apple (NASDAQ:) to Impartial from Outperform with a $140 per share value goal (down from the prior $180).

The lowered score and value goal mirror slashed estimates for iPhone and Mac on account of manufacturing disruptions at Foxconn’s key manufacturing unit in China. Reuters reported earlier this morning that Foxconn’s manufacturing at this facility is again to 90% of its full capability.

The analysts now anticipate Apple to ship 224 million iPhone models in 2023 with the lowered estimate reflecting provide chain points from Foxconn and a extra cautious stance on client spending for high-end gadgets. Estimates for iPad/Mac shipments are additionally slashed so that they now anticipate them to say no by 7% and 9% year-over-year, respectively.

Consequently, BNP Paribas Exane slashed the FY23-25 EPS estimates by round 6% to now stand 5%-6% under the consensus.

“Consensus has began to trim estimates, and we consider this may proceed and weigh on the shares,” the analysts wrote in a consumer observe.

Primarily based on these estimate cuts, the analysts see Apple inventory buying and selling at a “premium valuation,” which is difficult to justify.

“We see little purpose why Apple ought to commerce at a premium vs its platform friends (now at 22x FY23e PE). As new {Hardware} merchandise reminiscent of AR/VFR and Apple Automotive may not come earlier than 2024-26, we see no main optimistic catalyst for the inventory and consider the shares are pretty priced,” the analysts concluded.

Apple inventory fell almost 27% in 2022.