Sunny Optical Technology Group, which is expected to enter the Apple supply chain with its smartphone lenses, gained as much as 3.8 per cent before closing with a 1 per cent gain at HK$145.90.

Apple reported a fiscal year third-quarter revenue of US$59.7 billion, an 11 per cent gain from a year earlier. Also overnight, the Cupertino, California-based firm announced a 4-for-1 share split, which would lower its per-share price and attract individual investors and increase its liquidity, while the spillover could also lift the share prices of its suppliers.

“For Apple suppliers, the worst may be over,” said Kenny Wen, wealth management strategist at Everbright Sun Hung Kai in Hong Kong. “However, their stock prices rebounded during past few months and may already reflect the good news. I would wait for corrections to invest in those stocks.”

Apple is expected by tech watchers to include 5G capability in its new products, which will roll out a few weeks later after September, adding to their competitiveness as users go for the added speed for such things as online games and movies, analysts say.

In a new note, JPMorgan’s telecom team said it expects the world’s 5G smartphone shipments to more than double in 2021 “led by increases in our 5G volume outlook for Apple in North America and primarily outlook for Oppo, Vivo, and Xiaomi in the domestic Chinese market.” That expectation bodes well for Apple suppliers.

Analysts at Daiwa Capital Market urge investors to remain selective on quality names within the Apple supply chain, with Luxshare among their top picks. It sees “positive sentiment for the iPhone supply chain on the strong ramp-up of shipments in 2H20, with release of the new iPhones.”

Luxshare is highly popular among analysts, with 35 rating it a “buy”, two a “hold”, and one a “sell”, according to Bloomberg data. It has blown past its consensus target price of 55.18 yuan. Alex Ng of CMB International Capital, the most bullish among analysts, predicted on Friday that it will rise to 74.20 yuan over the coming 12 months.

Among analysts tracking GoerTek, 20 rate it a “buy”, three a “hold” and two a “sell”. It also has soared more than 100 per cent in 2020, soaring beyond its target price of 30.36 yuan.

AAC, based in Shenzhen, gets more mixed views from analysts, with 15 rating it a “buy”, 13 a “hold” and eight a “sell”. It also has shot over its consensus target price, but China Renaissance’s Jason Sun recently said the stock could hit HK$89.85 over the coming 12 months.

Sunny Optical has 40 “buy” ratings, seven “holds” and no sells. While it has shot over its consensus target price, one analyst – Kyna Wong of Credit Suisse – says it could hit HK$207, in what is its strongest endorsement.

TF Securities International analyst Kuo Ming-chi, who has become famous for his accurate predictions of the development of the Apple supply chain, expects Sunny Optical to start producing a large amount of iPad lenses and some MacBook lenses starting from the first half of 2021. The company, “China's top lens supplier”, is likely to mass produce iPhone 5P or 6P lenses in the second half of the year, Kuo said in a report last week.

AAC is down 9.3 per cent this year, while Sunny Optical has advanced 8.2 per cent.

Additional reporting by Yujing Liu