NOMURA: Apple Is Moving Into Its 'Ex-Growth' Phase, And The Stock Could Go As Low As $336

There are sure to be lots of brutal Apple takedowns from Wall Street today.

Here's one from Nomura, which declares that the company is now in its "ex-growth" phase, which is very ominous sounding.

The weak Q2 dynamics seem to support our view that Apple is moving into an ex-growth phase in which unit growth is likely to come increasingly at the expense of gross margin declines. The net effect is limited earnings growth, EPS that likely tops-out at $50, which is likely to attract a multiple little better than comparable ex-growth peers such as Microsoft and Cisco. An 8x ex-cash multiple on our EPS forecast of $50 plus $89 in excess cash drives our fair value of $490.

This table shows how Nomura values the stock:

And in a real ice age scenario, it could get even worse.

Potential downside risk to $336
If we exclude the excess cash, as some investors may do, then there is downside to the stock to $400. Moreover, if iPhone gross margins fall to 40% vs. our 47% forecast, then EPS could fall to $42 and fair value could decline further to $336.

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