Are Samsung’s (SSNLF.PK) Android-based devices finally showing some chinks in the armor? Société Generale analyst Andy Perkins raised his rating on Apple (NASDAQ:AAPL) stock from a “Hold” to a “Buy” and set a $575 price target based on information he recently collected from Asian suppliers, reports Barron’s.
According to Perkins, both Samsung and the overall Android platform may have already hit their peak. “Looking out further we believe we may be seeing the first signs of weakness in Android/Samsung handsets,” noted the analyst via Barron’s. On the other hand, the analyst sees “strong rises” in Apple’s iPhone sales.
Perkins cited a 20 percent increase in sales for Hon Hai Precision Industry and Pegatron as evidence that Apple’s iPhone revenues are rising. “Additionally, Chinese September export data shows handset value up 30 percent YoY. As there has historically been a close correlation between Apple iPhone revenues and Chinese export value (Hon Hai and Pegatron’s main manufacturing facilities are based in China), we believe that this also bodes well for Apple’s third quarter results,” wrote Perkins.
The analyst also cited the latest U.S. smartphone market data from comScore that showed Android has failed to add any market share over the three-month period ending in August. This trend is also likely to continue in the near future since this data does not include Apple’s recent iPhone 5S and iPhone 5C sales.
However, Samsung and Android aren’t just slipping in the U.S. market. According to Kantar Worldpanel data cited by Perkins, Samsung’s share of the European market has also shrunk. In the U.K., Apple’s various iPhone models have secured five of the top-ten smartphone spots in the uSwitch U.K. charts. Meanwhile, Samsung’s Galaxy devices are losing their positions in uSwitch’s top-ten chart. Perkins believes that all of this data suggests that Apple’s growth is accelerating worldwide.
“Now we believe that the momentum is with Apple, especially its new 5s model,” noted Perkins. Based on his supply chain checks and market research data, Perkins predicted that Apple will have revenue of $188 billion and EPS of $46.20 in fiscal year 2014. Here’s how Apple has traded over the past five trading sessions.
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