Citi cuts estimates on Apple, citing 'macro woes,' but offers 5 reasons to buy shares
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Investment firm Citi lowered its estimates on Apple (NASDAQ:AAPL) on Wednesday, citing cuts to consumer spending amid broader economic concerns and supply chain bottlenecks, but said there are still "several positive drivers" for the tech giant.
Analyst Jim Suva, who has a buy rating on Apple (AAPL) shares, lowered his price target to $175 and cut his earnings estimates for the rest of fiscal year, as he now expects Apple to earn $1.13 in the fiscal third-quarter and $1.22 per share in the fourth quarter, with full-year earnings expected to be $5.98 per share. 
Suva also introduced 2023 and 2024 earnings estimates at $6.51 and $6.86 per share, respectively. 
"We believe supply chain concerns are manageable given the June quarter is a seasonally slower quarter," Suva wrote in a note to clients, adding that continued headwinds in foreign exchange and from exiting Russia could weigh further on the quarter.
Suva also pointed out that there is the potential for consumers to replace their devices at a slower pace than they are currently -- at roughly 4 years for smartphones -- if economic conditions worsen and inflation continues to rise. 
And while there is still "solid" production coming from the iPhone supply chain, concerns about services revenue, specifically App Store and advertising, have also cropped up. 
Despite the broader economic issues, Suva listed five reasons investors should buy the stock, including the fact he believes the iPhone 14 build is "still on track" for a September 14 launch, adding that a foldable phone is likely to come in 2023. 
In addition, consumers continue to shift their purchases away from lower priced Android phones towards more mid end and premium priced products.
Apple (AAPL) also has a $90B stock buyback, which can support the stock, as well as "sticky" services revenue and perhaps offering devices-as-a-service.
Lastly, new product category launches, such as the upcoming mixed reality headset and possibly an Apple Car in 2025 are "not currently reflected in current estimates/market cap." 
On Tuesday, Bank of America said the fact that Apple (AAPL) had lowered the trade-in prices for the iPhone, iPad, Apple Watch, Mac earlier this month implies "strong demand."