5 Asian Suppliers To Buy Instead Of Apple

With Apple Inc. AAPL’s Q4 earnings results mostly in-line with market expectations, HSBC Global Research analyst Steven Pelayo recently discussed other ways to play the iPhone at the moment than buying Apple stock.

While Apple struggles to maintain growth in its position as the world’s largest public company, Apple suppliers are still fighting to gain market share. Pelayo believes that the bad news on iPhone sales growth is already baked into the market, and iPhone suppliers that are winning the market share battle are well-positioned to outperform.

“With expectations now lower and potentially conservative guidance released, we believe comps will get easier going forward,” he explains.

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Pelayo believes that Tim Cook’s projections of a less than a 15-20 percent year-over-year decline in March quarter iPhone sales, which suggests 52-55 million units, will ease market fears that sales would come in as low as 40 million units for the quarter.

HSBC prefers Apple suppliers Catcher, Radiant, LG Innotek, Flexium and Luxshare.

Disclosure: the author holds no position in the stocks mentioned.