Apple is expected to usher in a record upgrade cycle, with Wall Street raising its target price one after another
Apple is expected to usher in a record upgrade cycle, with institutions such as Morgan Stanley raising their target price for Apple stock. It is predicted that Apple will ship nearly 500 million iPhones in the next two years, driving the average selling price of iPhones to increase by 5%, with total revenue reaching nearly $485 billion. At the same time, Loop Capital has also upgraded Apple's rating to "Buy" with a target price of $300. These institutions believe that Apple has the opportunity to consolidate its position as the "headquarters" for artificial intelligence preferred by consumers
According to the Zhītōng Finance APP, Morgan Stanley stated that Apple (AAPL.US) is about to usher in a record-breaking multi-year upgrade cycle, as Apple Intelligence provides a clear catalyst.
Morgan Stanley analysts Erik Woodring, Maya Neuman, and Oluebbe Udochukwu stated in a report: "Our in-depth analysis of Apple's upgradable iPhone user base, upgrade rate, new user growth, and iPhone model mix indicates that Apple will ship nearly 500 million iPhones in the next two years, 6% higher than the record-breaking cycle of the 2021-22 fiscal year, while driving a 5% increase in the average selling price of iPhones. By the 2026 fiscal year, total revenue will reach nearly $485 billion, with profitability reaching $8.70, 7-9% higher than the market's general expectations."
Morgan Stanley previously forecasted Apple's revenue for the 2026 fiscal year at $459 billion, with earnings per share of $8.20.
Morgan Stanley also raised Apple's target price from $216 to $273 and designated the stock as its "top pick."
The bank expects Apple to ship 235 million and 262 million iPhones in the 2025 and 2026 fiscal years, respectively.
Meanwhile, Loop Capital upgraded Apple's rating from "hold" to "buy" on Monday, raising the target price from $170 to $300, nearly doubling it.
Loop Capital's supply chain analyst John Donovan stated in a report on Monday that Apple has the opportunity to "consolidate its position as the consumer's preferred artificial intelligence 'hub,' just as it did 15 years ago for social media (iPhone) and 20 years ago for digital content consumption (iPod)."
Loop Capital analyst Ananda Baruah said: "These trends are important stock catalysts, and basic math suggests that Gen AI has the potential to be a similar catalyst."
Apple plans to announce its third-quarter performance for the 2024 fiscal year on August 1st local time. Analysts expect earnings per share of $1.32 and revenue of $83.73 billion