With Apple (AAPL) shares down $18.97, or almost 4%, at $510.72, as UBS and Jefferies trimmed iPhone estimates, and pondered issues of China demand and iPad cannibalization, a number of Apple suppliers have come under pressure today.
Qualcomm (QCOM), which makes wireless chips for the iPhone and iPad, is off $1.87, or 3%, at $60.89, and earlier sank as low as $59.44. Jabil Circuit (JBL), a contract electronics manufacturer that gets a larger portion of revenue from Apple business, is down $1.04, or almost 6%, at $17.49. And Cirrus Logic (CRUS), which makes audio chips for both devices, is off $1.74, or 6.4%, at $25.67.
Amitabh Passi, colleague to UBS’s Steve Milunovich, who cut his iPhone outlook, this morning cut his price target on Jabil to $23 from $25, while reiterating a Buy rating, warning that he is “incrementally more cautious” heading into the company’s November-ending fiscal Q1 report due next Wednesday, December 19th.
Passi cites both the Apple iPhone issue, and what may be a brief delay before Research in Motion‘s (RIMM) “BB10″ BlackBerrys hit stores:
The overall demand environment remains muted, and our recent checks also suggest greater downside risk to iphone5 builds in C1H13 (UBSe Apple 13-16% customer), and that BB10 may not ramp in earnest (UBSe RIM 7- 8% customer) till Feb/Mar 2013.
Passi maintains an estimate for last quarter of $44.4 billion and 57 cents a share in profit but cut his February-ending Q2 estimate to $4.3 billion and 56 cents a share from a prior $4.4 billion and 59 cents.
Oddly enough, Passi’s report today comes amidst a stream of relatively positive notes for Jabil. Raymond James’s Armit Daryanani reiterated an Outperform rating and a $27 price target, writing “We believe JBL is positioned to report upside to consensus expectations for Nov-qtr and provide Feb-qtr guide inline with consensus.”
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