“Needham & Co.’s Charlie Wolf this morning raised his price target on Apple shares to $540 from $450, while reiterating a Buy rating on the stock,” Tiernan Ray reports for Barron’s.
“Wolf sees increased value in the iPad, especially, but also the Mac and iTunes since he last performed a valuation evaluation, if you will, on Apple, back in February,” Ray reports. “For example, the iPad business is now more valuable, in his view, because it ‘should capture a materially larger share of the tablet market than we previously forecast.'”
Ray reports, “Wolf sees the Mac business more valuable based on the “halo” effect from the iPad, rather than the iPod, and after calculating the growth of app sales, he thinks iTunes is much more valuable than he’d estimated. Oh, and then there’s the nearly $80 billion in cash. That raised his valuation estimation as well. Wolf explains that his update to the iPad’s value reflects the failure of competing tablets. Like the iPod before it, he thinks the iPad will maintain a dominant share, even though he expects competing tablets to be brought to market for some time to come.”
Read more in the full article here.