Apple investors made a big bet on a rare and powerful event that’s about to pay off or fizzle in the sky (AAPL)

Apple CEO Tim CookApple

• Apple will report its fiscal Q1 earnings on Thursday.
• The company will likely report record quarterly revenue and healthy earnings per share.
• But Wall Street is focused on second-quarter guidance, and in particular whether the long-awaited iPhone super cycle is still in the offing.

Apple will have a tough act to follow when it reports its earnings on Thursday, hours after a rare super blue blood moon graces the night sky.

Like eager stargazers awaiting the super moon, Apple shareholders are anxious to be dazzled by a long-anticipated “super cycle” of iPhone sales.

They may be disappointed.

In recent weeks, several Wall Street analysts have pointed to a drumbeat of worrisome reports about Apple’s component suppliers that suggest iPhone sales might slump in the first three months of the year.

Tom Anderson/Twitter

“Recent datapoints on iPhone sales continue to point to weaker-than-expected demand for the new iPhone models,” Deutsche Bank analysts wrote in a January 29 note to clients.

Apple’s stock, which was trading near its 52-week high earlier this month, has come down about 6% over the past two weeks as the worries have mounted.

Apple is expected to post revenue growth of 11% in its recently ended fiscal Q1. But regardless of how strong of a quarter Apple puts in the bag during this past holiday sales season, Wall Street is focused squarely on Apple’s expectations for the coming year — in particular, whether the company’s new three-headed phone line-up compels a stampede of consumers to upgrade their phones and drives a sales bonanza.

Shoot the moon

Justin Sullivan/Getty

Many Apple watchers believed that the new iPhone design released last October, the iPhone X, would spur a large group of people holding onto older iPhones to upgrade this year, thus creating a “super cycle.”

But although the iPhone X has been well-received by critics, who praise its gorgeous OLED screen and innovative facial recognition technology, it’s not clear that it’s ignited the passion of consumers.

Part of the issue may be the phone’s $999 price tag, the highest priced iPhone that Apple has ever sold.

“Our argument has been that the phones were too expensive to drive massive adoption, consumers are keeping their phones longer because of their high cost, the market is now only a refresh market, and the iPhone X features weren’t enough to drive non-early adopters to buy new phone,” Deutsche Bank analysts wrote in a recent note to investors.

Another worry is that Apple’s offer to replace batteries on older iPhones at a discount, stemming from the “batterygate” scandal, could crimp upgrades by giving customers a cheaper alternative to buying a new phone.

“We don’t think fiscal 2018 will be a ‘supercycle’ year given unit growth of about 10% dependent on China,” said UBS analyst Steve Milunovich in another note.

Apple will provide revenue guidance for its second fiscal quarter on Thursday. Wall Street analysts predict on average that Apple’s guidance for next quarter will be about $67.1 billion, but some analysts now go as low as $60 billion, which would mean that Apple’s iPhone sales could be extremely disappointing.

Apple providing guidance “below $66 billion likely would result in a stock price decline,” said Milunovich.

Be patient until the second half

Still, many Apple analysts are telling people to hold their Apple shares, especially if the guidance for next quarter is weak.

The iPhone X’s new “animoji” feature is popularThomson Reuters

“We believe if Apple guides to low end of Street whisper numbers, with a strong ASP and three device lineup slated for the next 9 months that the stock will rebound from here,” GBH Insights analyst Daniel Ives told Business Insider.

He believes Apple could sell 240 million iPhones in 2018 — higher than its previous record in 2015.

KGI Securities analyst Ming-Chi Kuo, who is famous for his “Apple Insight” research, wrote earlier this month the “real super cycle” in Apple won’t happen until the second half of 2018, when a new iPhone product lineup could spur the wave of upgrades investors are hoping for.

Another cause for optimism: the average price for an iPhone could be going up, especially after the $1,000 iPhone X was released. A higher ASP could show that Apple’s customers are willing to stick with Apple despite higher prices, and could suggest further upside even if iPhone unit sales stay flat.

“Cover fire” for iPhone disappointment

Apple exec Eddy Cue (center) overseas the company’s music effortsGetty Images

With so much uncertainty in iPhones, some investors are looking to other corners of Apple’s business for a potential upside surprise.

“The iPhone drives the narrative, but firing on all cylinders in other parts of the business could provide cover fire for any iPhone disappointment,” wrote UBS analyst Milunovich.

Apple’s service business, which includes revenue from App Store, Apple Music, and other online services and subscriptions, is increasingly important and could move the needle.

“In our model, we have hardware revs flat post iPhone X,” Macquarie analyst Ben Schachter wrote on January 29. “And yet we have EPS showing a 13% compound annual growth rate,” due to high margin services and capital return.

“The bottom line is that Services and the app ecosystem will likely be responsible for a significant percentage of Apple’s future profit growth,” he continued.

Another thing that could boost Apple’s stock is if it commits to give a lot of money to shareholders. Increased share buybacks and dividends could provide downside protection for investors, Keybanc analysts wrote in a note. And Apple was a major beneficiary of the recent tax return, although the company hasn’t yet committed to the $252 billion it can bring back to the United States after paying $38 billion in taxes on it.

Here are the key numbers that Wall Street expects for Apple’s recently-ended quarter, via Bloomberg data:

Revenue: $87.1 billion (Apple itself expects $84 billion to $78 billion), which would represent an 11% increase year-over-year.

EPS (GAAP): $3.83

iPhone sales: 80.2 million

Business Insider will be covering Apple’s results live as they cross the wire on Thursday.