Shock Drop in iPad 2 Demand? Not So Fast, Say Analysts

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Word is the iPad 2 may be selling less, shall we say vigorously, than Apple hoped, that Cupertino is cutting orders by an astonishing 25% to compensate and that, yep, we could be looking at our first iPad 2 price drop.

The folks claiming as much have a name for a change: J.P. Morgan Chase & Co. told investors that Apple has slashed its 4Q 2011 iPad orders by 25%, says Bloomberg. It gets even more ominous: J.P. Morgan says it’s the first cut of this magnitude they’ve ever seen. And Wall Street’s responded: Apple shares fell sharply in early Monday trading…then mysteriously recovered.

(MORE: Amazon’s Surprise Wednesday Press Conference to Unveil 7-Inch Tablet?)

Wait, recovered? Perhaps because of what Fortune‘s Philip Elmer-DeWitt had to say, namely “Did J.P. Morgan forget Brazil?” (Elmer-DeWitt playfully notes Business Insider‘s link-bait headline, “HOLY CRAP: Apple Just Cut iPad Orders By 25%.”)

So what’s up in Brazil? Elmer-Dewitt references a rumor from a few weeks back, in which Apple reportedly partnered with the Brazilian government to build an iPad plant in Brazil. Also: The plant will supposedly be ready to produce Apple stuff by this December.

Meaning? That the cuts J.P. Morgan’s talking about could just be Apple redistributing its manufacturing-related eggs.

“Apple purposely maintains enough suppliers and manufacturing partners to make any one supply-side data point inconclusive,” said Piper Jaffray analyst Gene Munster (via Fortune).

Add to that Bullish Cross analyst Andy Zaky’s: “We believe the report out of JPM is extraordinarily misleading, given that it attempts [to] draw a conclusion regarding Apple’s expectations which are simply not founded in evidence.”

In any case, chasing one rumor with another is like trying to put out fire with fire. File all of the above under “truthiness,” either way, until we get official confirmation from someone reliable.

MORE: IDC: iPad 2, PlayBook Gobbled Android Market Share Last Quarter

Matt Peckham is a reporter at TIME. Find him on Twitter at @mattpeckham or on Facebook. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.

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