Analyst: Why you may not want to buy the iPhone SE

Preorders for Apple's new iPhone SE are rolling in, but analyst Amit Daryanani said Monday the 4-inch cellphone was going to have only a modest effect on the company and suppliers.

"End of the day, it's not going to be a huge product," Daryanani said on CNBC's "Squawk Alley." "We think 15, 20 million units. So about 4 or 5 percent of total Apple phones in a given year."

He said supply-chain companies also stand to see some benefit from the device, which goes on sale in stores on March 31 at a starting price of $399. "The point would be it's a small number. It's 4 or 5 percent of the iPhone unit base right now," said Daryanani, an equities analyst for RBC Capital Markets.

Moreover, he thinks the SE could end up being harmful to Apple's gross margins. "The iPhone SE's price is very attractive, potentially at a risk to Apple's own gross margins. We do think Apple would look for the supply chain to share some of the pain with them," he said.

Daryanani said investors in the supply-chain trade might want to wait until the release of the iPhone 7 this fall.

"I do think the SE, while it helps everyone on the unit, it could have a negative impact on gross margins," he said. "I think the 7 will be a much cleaner product for Apple and its supply chain to work."