As Trade War Escalates, Will Apple Weather the Storm? Experts Aren’t So Sure
It’s no secret that the United States is currently in a trade war with China, a situation that has heavily affected the stock market. While many firms are directly suffering as a result, experts in Wall Street are of the opinion that Apple will be the one company that weathers out this storm.
One of the said experts is J. P. Morgan’s Samik Chatterjee, who says that although the situation is not ideal and poses a risk for the revolutionary tech giant in terms of earnings, the company will pull through in ways most investors won’t see coming.
New iPhone Line
One of the reasons leading to J.P. Morgan and Chatterjee’s conclusion is the fact that Apple is set to release a new iPhone line later this month. According to the financial institution, Apple makes most of its revenue (approximately 55%) thanks to the iPhone. There’s no denying the phone is massively popular in the States and around the globe.
The China standoff and implementation of tariffs notwithstanding, Chatterjee opines that this launch will protect the company. Whichever way said tariffs are implemented, Apple will absorb their cost without even have to extend the expense to U.S. buyers. You’ll get to buy your phone at a non-inflated cost, a situation that the target market will certainly appreciate.
D.A. Davidson also has the same opinion as J.P. Morgan, with Tom Forte, an analyst at the firm agreeing that the China trade war does pose a threat to Apple seeing as the company gets its supplies from the East Asian country, and also has an enviable target market there.
All the same, he seeks to calm investors’ nerves, saying that AAPL may not be that hard-hit by the current situation. And the fact that the U.S. and China have agreed to trade talks in October, something good may come of it, and the war may not last till the end of the year.
Mitigating Tariff Impact
What’s more, Forte hails the company’s strategy in mitigating tariff impacts. They ensure they are in the government’s good books, and isn’t the government responsible for creating an enabling environment for this and all other companies?
The almost perfect relationship Apple has cultivated with the government has led to some of its products being excluded from tariffs in the past, and will allow it another opportunity to sell a new line of iPhones without being affected by current ones.
And interestingly, Forte also believes that the tech giant is big enough to also lobby the Chinese government and get some form of protection from tariff impact. What do you think?
Truth be told, the post-Steve Jobs era has been perfect for the company. Under Tim Cook’s leadership, Apple has held its own. Milestones have been achieved, and previous standoffs with China have come and gone, leaving the company holding its head high. Why would this one be any different?
But what would you expect of a company that three years announced that they had over a billion devices in use around the globe? That’s quite the consumer market!
More in Business
-
`
Streaming Giant Netflix Faces Yet Another Challenge
In the ever-evolving landscape of streaming entertainment, Netflix, once the unchallenged king of digital content, now faces a complex puzzle beyond...
December 1, 2023 -
`
Signs You Should Quit Your Current Job & Move On
You Don’t Feel Comfortable at Work Imagine spending the majority of your waking hours in a place where you feel uneasy,...
November 20, 2023 -
`
How to Adjust and Renew Your Portfolio
Investing in the financial world is like navigating an ever-changing landscape—constantly evolving, always shifting. The key to staying on track? Regularly...
November 18, 2023 -
`
Dr. Dre’s Divorce With Nicole Young: A Closer Look
When the beats of old-school hip-hop start bumping, Dr. Dre’s name reverberates in fans’ minds worldwide. Born as Andre Young, this...
November 12, 2023 -
`
Why Branded Content Is the Best Way to Connect With Your Audience
Have you ever found yourself deep in a compelling article or engrossed in a video series, only to later discover that...
November 5, 2023 -
`
Why the Gender Pay Gap Could Be Getting Worse | New Research Findings
At a time when women are making significant strides in various professional arenas, a new report throws light on a trend...
October 28, 2023 -
`
What Is a Bull Market and How Can Investors Benefit From One?
In finance, the term “bull market” is frequently used to describe a period of optimism, rising asset prices, and investor confidence....
October 19, 2023 -
`
A-List Power Couples Where the Women Make More Money
In an era of shifting gender roles and evolving definitions of success, it’s increasingly common to find celebrity couples where the...
October 15, 2023 -
`
Massive Price Cuts: Tesla Only Witnesses ‘Modest’ Sales Gain in China
Cutting Down Prices, But Not Cutting the Mustard? Summer 2023 brought with it a promise of sunshine and relaxation. For Tesla...
October 8, 2023
You must be logged in to post a comment Login