Buy Apple On The iPhone 7 Launch: Citi

Citi’s store checks suggest that there has been robust preorder activity for the iPhone 7.

Citi’s Jim Suva maintained a Buy rating on Apple Inc. AAPL, with a target price of $120.

Strong Preorder Activity

Suva mentioned that store checks at Apple, as well as at carrier stores in the U.S., Canada and Asia revealed that preorder activity had been strong.

“Supply remains the gating factor for iPhone 7 Plus and iPhone 7 Jet Black models which arrived in very limited quantities at stores, and in some cases only to suffice for those who had pre ordered and were picking it up in the Apple store,” the analyst stated.

Suva explained that lines had been short at carrier stores because these stored had already informed the consumer regarding limited stock availability. Therefore, most of the people had been there to pick up their pre-ordered phones.

The analyst believes that the demand for the iPhone 7 Plus is being driven by the improved camera features.

Watch Series 2 & Airpod

On the other hand, interest has been muted for Apple Watch Series 2, while the AirPod will not be available till Octobers, although early interest in the product appears modest.

“While it is difficult to extrapolate weekend sales, preorders or even a few days of sales, to overall quarterly unit estimates, we note increased promotion commotion from carriers,” Suva pointed out.

The iPhone 8 phones, expected in 2017, are likely to driver further upgrades within the installed base.

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