Will The Apple Watch Come Up Short? JP Morgan Responds To Rumors

In a report published Tuesday, JP Morgan analyst Rod Hall commented on media reports that Apple Inc. (NASDAQ: AAPL) is facing supply issues for its Watch. The analyst cited specifically AppleInsider who noted that supply issues for Apple are "not unexpected" and the company is "prepared for them."

"We believe Apple is likely struggling with initial low yields due to waterproofing and other new production challenges," Hall wrote. "We believe Apple's threshold yields for the device are running 65 percent to 75 percent versus more typical 90 percent to 95 percent for the iPhone."

See Also: Apple Watch Shipments Cut In Half?

Nevertheless, Hall stated that Apple's initial low yields represents a "neutral impact" for shares.\

Shares of Apple closed Monday at $127.21, up 1 percent.