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Apple stock is a hair below its all-time high of $ 136.69, reached December 28, 2020.
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Apple
Shares are rising faster as investors pile into megacap technology stocks in the run-up to the upcoming wave of quarterly results. Apple will report the results next Wednesday, January 27, and Street’s expectations are getting more optimistic by the day, keeping the stock just a few points below their all-time high.
Morgan Stanley analyst Katy Huberty on Thursday reiterated her assessment of Overweight on Apple stock, raising her price target from $ 144 to $ 152. She writes that her audits show that Apple saw strength in its products and services portfolio in the past quarter, driven through the adoption of 5G iPhone, the trend of working and learning from home, and continued engagement with the App Store.
“We are ahead of what we expect to be a record quarterly pressure in December,” Huberty wrote in a research note. “Our recent talks suggest investors expect Apple to post solid, but not great, quarterly results for December. We disagree and think Apple is likely to report record quarterly sales and earnings. “
Huberty expects double-digit revenue growth across all revenue segments, with “risks up” for iPhones, Macs and Services. Its estimated revenue for the quarter is $ 108.2 billion, well above the consensus of $ 102.6 billion. She sees earnings for the December quarter of $ 1.50 a share, above the street at $ 1.40. (Note that the company did not provide guidance for this quarter, citing the uncertainty associated with the pandemic.)
“We expect demand to remain strong and our earnings and earnings per share for fiscal 2021 both to be 5% above consensus,” she writes. “Given the quarter’s positioning has been dampened following the rotation of high-value stocks in recent months, we expect a strong follow-up after earnings.”
Huberty thinks the iPhone 12 was Apple’s most successful product launch in the past five years. She forecasts 78 million iPhones shipped in the quarter at an average retail price of $ 825, delivering 14% revenue growth to $ 63.9 billion – twice the growth rate the Street consensus currently expects for iPhone revenue. And she expects iPhones’ momentum to continue into 2021. She notes that Apple’s Taiwanese supply chain partners have had accelerated year-on-year revenue growth for three consecutive months, which she says signals strong iPhone sales in the US coming quarters.
DA Davidson analyst Tom Forte also reiterated his Buy rating for the stock, noting that the stock looks “delicious” even though it has pushed past its $ 133 price target. (He says his target is “being revised” in anticipation of next week’s earnings report.) Forte also has estimates that are above consensus for the quarter – he sees revenue of $ 106.2 billion, with a profit of $ 1 , 52 per share. “We believe Apple’s first batch of smartphones on 5G networks is better positioned than investors fully appreciate,” he writes in a research note.
Monness Crespi Hardt analyst Brian White is also repeating his Buy rating, while maintaining his target price of $ 144. White’s estimates call for $ 105.3 billion in sales and earnings of $ 1.47 per share. “The strength and linearity of this economic recovery remains a wildcard; however, we believe that Apple’s strong balance sheet, iconic brand, fast-growing services business, pipeline of innovations and tough stance on personal privacy will enable the company to emerge stronger from this crisis, ”he writes.
Apple shares are up 3.1% to $ 136.10 during recent trading. The stock is up more than 6% in the first two days of the Biden administration, increasing its market cap by $ 133 billion in that short period. The stock is one hair below its all-time high of $ 136.69, reached on December 28, 2020, as well as its record during the intraday peak of $ 138.79, which it hit on December 29. Apple shares have a market value of $ 2.278 trillion, and Apple remains the world’s most valuable company.
Write to Eric J. Savitz at [email protected]