An analysis by KeyBanc Capital Markets reveals that Apple Inc. experienced a significant sales boost in June compared to previous years. However, Brandon Nispel, an analyst at KeyBanc, remains cautious about the overall performance of the company.

Data from U.S. card spending indicates a 23% increase in direct Apple purchases during June, for transactions of at least $400. This growth rate surpasses the average 2% growth seen in June over the past three years.

Despite these positive figures, Nispel highlights a 15% decline in spending for the entire June quarter. This decline is higher than the average 9% decline observed over the past three years.

Considering management’s forecast of a similar revenue decline in the fiscal third quarter as seen in the second quarter, Nispel suggests that there may be downside risk to consensus estimates.

Nispel also points out that domestic iPhone sales are facing pressure from slowing U.S. carrier activity and lower upgrade rates. He believes that his below consensus estimate of a 19% decline in total hardware revenue is justified, while consensus expectations suggest a 17% decline.

Furthermore, Nispel highlights historically low smartphone upgrade rates in the U.S., further adding to the challenges faced by Apple.

While Nispel remains cautious about the recent quarter’s results, he maintains an optimistic view on Apple shares in the long run. He has increased his price target for Apple shares to $200 from $180 and continues to rate them as overweight.

According to Nispel, investors’ enthusiasm for new products and their inclination towards safer investments contribute to an elevated multiple for Apple shares.

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