For whatever reason analysts are still buying into the idea that Apple will somehow magically recover sales in Q3 and Q4 of FY’16. However, I take the opposing stance as sales are unlikely to recover due to the seasonal trends of spring and summer. Softness in demand seems relatively likely and the weakness in demand will most likely carry over into the next couple quarters. I now anticipate iPhone shipments of 174.5 million for FY’16, which sounds aggressive. But with the recently cited weakness in Q2’FY 15 production and weakening sentiment among the analyst community the stock is poised to wrestle out of weak hands. Sales are expected to drop by 35% based on the most recent estimates in Q2’FY 15 from analysts at Oppenheimer, Deutsche Bank, and etc. Some mention that production levels should return to a more normal pattern in the remaining two quarters, but I find that highly unlikely because full-year sales are heavily correlated to holiday demand. If peak demand is weak during holiday season, what’s to indicate that it will actually improve? Furthermore, Q4 will remain tough as usual because consumers will hold back purchases on the iPhone 6S in anticipation of the iPhone 7. While there’s no denying that a sentimentally fueled rally is somewhat feasible in the second half of the year, we’re not dealing with a stock that’s broken on a technical basis, but rather a broken growth model. Furthermore, some of us are wondering if we have witnessed peak Apple, which is certainly a possibility given the softness of demand in the current S cycle, which is the worst we have ever witnessed. At this point, further penetration into the $600+ ASP market will be rather limited, and the usage of overseas cash seems highly unlikely without a repatriation holiday. Smartphone sales are expected to slow even further and further penetration into the emerging markets indicates that organic growth will primarily come from the low-end. Furthermore, Chinese demand will likely taper off in response to weakness in consumer sentiment and overall slowdown in macro. While much of this is already priced into the stock, I believe the stock will reach $88.71 by year end (prior price target was $103.50).