Technology

3 Tech Stocks to Buy That Are Benefiting From Big Apple Sales

If there is one company that continues to plow ahead and control their world it’s Apple Inc. (NASDAQ: AAPL). Another positive quarter helped the stock to jump, and it’s now up almost 30% from the intra-day low it hit on August 24. Apple isn’t the only winner with the big sales and earnings report; the vendors who supply the tech behemoth are also cashing in. A new research report from RBC highlights the companies that may be among the biggest winners.

RBC points out that the recent positive earnings report and guidance from Apple are a modest positive for the company’s supply chain vendors and should help to calm investor concerns that iPhone units can continue to grow in the iPhone 6s cycle. In fact, RBC sees the company shipping 75 million units in the fourth quarter and 62 million in the first quarter of 2016.

Here are three companies RBC sees as benefiting from the positive Apple third-quarter report, and all three are rated Outperform at RBC

Amphenol

Amphenol Corp. (NYSE: APH) is the top pick at RBC, which sees the company benefiting from the Apple strength as about 10% of total sales are to Apple, mainly in iPhone and iPad antenna and connectors. Amphenol is one of the world’s largest designers, manufacturers and marketers of electrical, electronic and fiber optic connectors, interconnect systems, antennas, sensors and sensor-based products and coaxial and high-speed specialty cable. It designs, manufactures and assembles its products at facilities in the Americas, Europe, Asia, Australia and Africa and sells its products through its own global sales force, independent representatives and a global network of electronics distributors.

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The RBC team sees the company also enjoying improving sales to Cisco. In fact they have modeled the IT and data communications business to grow as a result of the Cisco guidance. That is in addition to upside for fourth-quarter growth as a result of the strong Apple sales.

Amphenol investors are paid a small 1.03% dividend. RBC has a $60 target price on the stock. The Thomson/First Call consensus price target is $58. Shares closed trading on Thursday at $54.40.