Analysts from multiple firms are trying to sell the view that the iPhone 8 (or whatever 2017’s model ends up being called) will trigger another super-cycle of growth for Apple Inc. (NASDAQ:AAPL), but that may not turn out to be the case. CNBC’s Jim Cramer cautions against what he calls “hype” about a super-cycle being triggered by the 2017 iPhone.

Margins are also still in focus, and UBS analysts are warning that changes in Japan might hurt the company’s highest-margin market.

Apple Inc. (AAPL): Warnings About Japan And The Super-Cycle Hype

Apple (AAPL) may lose share in Japan: UBS

In a report dated June 28, UBS analyst Steven Milunovich highlighted the Japanese market as an area of concern for Apple Inc. (NASDAQ:AAPL). His note is interesting in light of the huge disappointment China was in Apple’s last earnings report.  He points out that in fiscal 2015, Apple’s growth in Japan slowed to 3%. In the fiscal second quarter, the market made up 8% of the iPhone maker’s sales and 11% of its operating profits. It also had the highest geographical operating margin at 45%, he said.

However, changes are underway in Japan, and the UBS analyst sees potential problems for Apple Inc. (NASDAQ:AAPL). For one thing, he said mobile carriers are not discounting phones as much to draw subscribers away from competitors, which could weigh on overall phone sales. Other changes involving Japanese carriers are underway as well. The Japanese government is calling on them to reduce prices because monthly phone bills are at around 4% of disposable income, which lawmakers say is too much.

This is a problem because typically they charge high monthly prices of at least $70 to recoup the deep discounts they offer on phones. Apple’s iPhones carry a premium of 15% to 20% in Japan compared to where they’re priced at in the U.S., so discounts are needed to attract buyers there.

Another issue for Apple Inc. (NASDAQ:AAPL) is the growing popularity of mobile virtual network operators (MVNOs), which sell a SIM card and offer much lower rates for subscribers who use their own phone. Such subscribers typically keep their phones much longer, so Milunovich sees a “potential double whammy to Apple of handset share loss and longer upgrade cycles.”

He expects Apple Inc. (NASDAQ:AAPL) stock to remain range-bound for now, but he maintains his Buy rating and $115 price target.

Pumping up the iPhone 7

But Apple’s potential problems extend beyond Asia as analysts have been trying to assure investors that the iPhone 7 cycle will be strong despite the rumors that it won’t be much of an upgrade from the iPhone 6s. Cowen analysts said in a research note today that their analysis of the iPhone installed base indicates that a “‘powder keg’ is forming,” even though it looks like the iPhone 7 will be about flat with the iPhone 6s and the macro risks are clear.

CNBC’s Jim Cramer said on Squawk on the Street this morning, however, that he doesn’t like the term “super cycle” because often it leads to “too much bullish enthusiasm.” He advised investors not to trust the “hype” about a super cycle, adding that he wished Cowen hadn’t used the term.

“If people get too excited about Apple Inc. (NASDAQ:AAPL), that’s going to hurt the story,” he said, according to The Street.

Apple Inc. (NASDAQ:AAPL) shares rallied today after a tough pair of trading days following the Brexit vote. The stock climbed as high as $92.90 and is up 0.84% at $92.81 as of this writing.

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