CITIC International expects Apple's strong momentum to continue, prefers supply chain stocks

CMB International Research Report indicates that Apple's (AAPL.US) performance in the first quarter of fiscal year 2026 is impressive, with revenue increasing by 16% year-on-year, surpassing expectations, mainly driven by strong iPhone sales and a recovery in the Chinese market. Additionally, favorable product mix and leverage effects have further expanded the gross margin to 48.2%.

Looking ahead to 2026, considering the iPhone Fold/18 upgrade cycle, increased market share in the high-end market, and collaboration with Google in the AI field, CMB International expects the strong momentum of the "iPhone cycle, price cycle" to continue; Apple, leveraging its supply chain advantages and strong pricing power, is better positioned than its peers to cope with memory cost pressures. The firm also prefers companies expected to achieve market share growth in the new product cycle (such as iPhone Fold/smart home/AI glasses), including LUXSHARE-ICT (002475.SZ), AAC TECH (02018.HK), FIT HON TENG (06088.HK), and BYD ELECTRONIC (00285.HK).

CMB International's ratings and target prices for related tech stocks:

Stock | Investment Rating | Target Price (HKD)

AAC TECH (02018.HK) | Buy | 60.55

BYD ELECTRONIC (00285.HK) | Buy | 43.54

FIT HON TENG (06088.HK) | Buy | 6.46

LUXSHARE-ICT (002475.SZ) | Buy | 75.55 RMB

Sunny Optical Technology (02382.HK) | Buy | 91.38