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That’s where analyst Toni Sacconaghi draws the line.

From a note to clients that landed on my desktop Friday:

It’s been a rough 4 months for Apple. You pre-announce one quarter of weak iPhone sales, and suddenly every iPhone bear case emerges from the woodwork: China. Negative price elasticity. Replacement cycle elongation. Trade wars. Commoditization.

And indeed, we ourselves remain worried about the iPhone. This cycle has clearly been weak. Estimates have come down, but perhaps they still need to come down more. Apple has gotten cheaper, but it’s still not that cheap – in fact, valuation is roughly in-line with 5-year averages.

And what about Services? While the segment grew 18% in the December quarter, we’ve now started to get investor questions worrying about whether the App Store will be the next shoe to drop.

Certainly, the headlines in the last few months haven’t been encouraging. Netflix, Spotify, and Fortnite have all stopped / threatened to stop paying the so-called “Apple Tax” of 15-30% on App Store revenues. And in November, the Supreme Court began deliberating a lawsuit seemingly targeted at the crux of the App Store model – i.e. whether the Apple Tax constituted a monopoly that has overcharged customers for apps.

This latter issue, however, is where we draw the line. Let us be clear here: we are not concerned – at all – about potential disintermediation of the App Store. It’s not a top concern of ours. In fact, it’s not even a top seven concern (Exhibit 1).

Allow us to explain why…

In the paragraphs that follow Sacconaghi shoots down, like so many clay pigeons, four theories of the bear case. His topic headings tell the story:

• LAWSUIT? WHAT LAWSUIT?
• A DEVELOPERS’ REVOLT: DEAD ON ARRIVAL
• WHAT DOES “COMPETITION” EVEN MEAN?
• BRANDS AND SWITCHING COSTS AND NETWORK EFFECTS, OH MY!

Maintains Outperform rating and $160 price target.

My take: Sacconaghi is one of the smarter ones, at least in my book. He had some fun with this one.