Now, Wall Street's In A Full-On Food-Fight About Whether Apple Cut iPad Orders

Not surprisingly, yesterday's JP Morgan report that Apple had suddenly cut Q4 iPad orders by 25% has prompted other Wall Street analysts to frantically respond.

Bloomberg has a good round-up.

JP Morgan's own Apple analyst, for example, Mark Moskowitz, who says "Apple is fine."

(The report was published by JP Morgan's Asia analyst, who based the conclusion on research done on Apple's supply-chain partners.)

Gene Munster thinks Apple is just moving some production to Brazil.

Barclays also rejected the report, suggesting that the cuts might be for components, not iPads:

“We disagree with any talk of a shipment slowdown,” analysts at Barclays Capital wrote in a report. “The numbers being circulated Monday might be related to components and not to actual iPad 2 shipments, in our view. Components checks (are) not a good proxy for actual iPad product shipments.”

Susquehanna analyst Chris Caso dismissed the call as "misleading," and said the orders had been "pulled-in," not cancelled--meaning that Apple actually moved the production into the third quarter to be sure to be able to keep up with holiday demand. (This is perhaps the most bullish interpretation of all).

But FBR's Craig Berger came rushing to JP Morgan's defense, saying he's hearing exactly the same thing:

Craig Berger, with FBR Capital Markets in New York, wrote a report saying his view was “largely consistent” with the research from JPMorgan’s Asia team on cuts to orders from Apple to iPad suppliers. The cut to fourth-quarter iPad production may reflect Apple being more cautious on overall global demand given recent market turbulence, and discounting some iPad growth in China, he wrote.

“For the iPad, 3Q11 builds were cut by 5%, while 4Q11 production estimates were cut by 24%, an incremental negative for Apple related supply chain participants,” Berger wrote.

IPad builds were cut by 24 percent in the fourth quarter from 17 million to 13 million, as iPad 2 WiFi builds were revised lower, and as ‘iPad 2 Plus’ production was removed from the forecast due to “display manufacturing challenges,” Berger wrote.

So there you have it.

For what it's worth, barring further startling stories out of Asia, I suspect the world's attention will now focus almost exclusively on the iPhone 5 launch next month.

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July Factory Orders Rise 2.4%, Beat Expectations

July factory orders increased 2.4% in July compared to market estimates of +2%.

Last month's number was revised to -0.4%.

A majority of the growth came from civilian aircraft and auto which led to a 4% gain for durable goods last week.

New orders for manufactured goods in July, up two of the last three months, increased $10.5 billion or 2.4 percent to $453.2 billion, the U.S. Census Bureau reported today. This followed a 0.4 percent June decrease. Excluding transportation, new orders
increased 0.9 percent. Shipments, up two consecutive months, increased $7.1 billion or 1.6 percent to $453.2 billion. This followed a 0.6 percent June increase.

Unfilled orders, up fifteen of the last sixteen months, increased $6.9 billion or 0.8 percent to $870.4 billion. This followed a 0.3 percent June increase. The unfilled orders-to-shipments ratio was 6.02, down from 6.05 in June.

Inventories, up twenty one of the last twenty two months, increased $2.9 billion or 0.5 percent to $598.0 billion. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.4 percent June increase. The inventories-to-shipments ratio was 1.32, down from 1.33 in June.

Expectations: A IFR survey expected 1.9% increase in factory orders for July, up from -0.8% in June.

Non-durable goods are expected to increase 0.2%. Durable goods, announced last week, increased 4.0% thanks to a big contribution from civilian airplanes and autos, with ex-transportation orders up 0.7%.

IFR notes: "August factory sentiment surveys have been weak so far, with only the Kansas City reading (+3) showing any sort of growth. Still, the real activity readings have been a bit more resilient than the surveys, so with orders growth continuing to trend upward, manufacturing may be able to dodge a significant contraction during the current soft patch.""

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