Mizuho Upgrades Apple To Buy, Sees $120 As Investors 'Missing The Forest'

• The share price of Apple Inc. (NASDAQ: AAPL) has declined 16.54 percent over the past one month, falling to a low of $96.45 on January 7.
• Mizuho’s Abhey Lamba has upgraded the rating on the company from Neutral to Buy, while lowering the price target from $125 to $120.
• Lamba believes that the short-term focus on the weakness in China and supply chain data points has led to an attractive risk-reward, and that Apple’s core franchise has significant upside potential.

Analyst Abhey Lamba explained that Mizuho’s “survey of 1000+ consumers indicated that Apple continues to command a healthy eco-system with a large number of loyal customers who are likely to upgrade phones over the next few years.”

However, Lamba also mentioned that the investor focus on short-term data points was a mistake, and that the bigger picture indicates a more positive stance on the stock. “Apple continues to represent a very strong franchise that has potential to keep gaining share,” Lamba said.

At the same time, Lamba also said that the F1Q16 revenue and EPS might come in below expectations when the company reports its results on January 26. The F2Q16 guidance is also likely to miss expectations, although this is mostly expected by now.