Apple Inc. AAPL reported solid third-quarter earnings, which bodes well for a handful of companies that supply components to the iPhone maker, according to KeyBanc Capital Markets.
The Analyst
KeyBanc's John Vinh reviewed Apple's supply chain channel in a research report.
The Thesis
Apple's Q3 print signals stabilized iPhone demand ahead of expectations for a ramp of a new device later this year, Vinh said in a note. (See his track record here.)
This bodes well for five supply chain companies, the analyst said.
- Broadcom Inc AVGO: Apple's solid iPhone shipment and lean inventory guidance are positive for Broadcom after the stock's "overreaction" in response to its acquisition of CA Technologies.
- Cirrus Logic, Inc. CRUS: Apple's report bodes well for Cirrus Logic's outlook, but limited content gains in the new iPhone imply minimal catalysts ahead for the stock.
- Qorvo Inc QRVO: Qorvo could see content gains in the new iPhone related to the super PAD, along with gains among Chinese smartphone OEMs.
- Skyworks Solutions Inc SWKS: Skyworks could see a 25-30-percent content gain in the new iPhone, which should offset any losses among Chinese smartphone OEMs.
- Synaptics, Incorporated SYNA: Synaptics faces a longer-term growth opportunity given the ramp of CoF display drivers in a new LCD iPhone.
Price Action
Apple shares were trading up nearly 4 percent Wednesday morning to $197.88
Related Links:
Apple's Stock Hits All-Time High After Beating Q3 Earnings, Sales Estimates
Rosenblatt: Apple's Q3 Highlighted By Higher iPhone Average Selling Price, Better Gross Margins
Photo courtesy of Apple.
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