Wedbush ups Apple price target to $600

Wedbush analyst Dan Ives says Apple has a ‘once in a decade’ opportunity to capitalize on iPhone upgrades as 5G networks roll out around the world, ups his price target to $600, and argues a bull case of $700 per share for the world’s most valuable company.

Image: Apple logoMartin Baccardax for TheStreet:

Ives says around 350 million of the 950 million iPhones in circulation could be upgraded over the next 12 to 18 months, with around 20% of those coming from China, arguably Apple’s most important market.

“China remains a key ingredient in Apple’s recipe for success (and) to this point we are seeing considerable strength from the China region over the last few months with positive trends heading into the fall, an impressive trajectory we expect to continue heading into the next 6 to 9 months,” Ives said. “Despite the noise, based on our recent discussions with contacts within the Beltway we strongly believe the WeChat ban will not negatively impact or disrupt Apple’s iPhone ecosystem within the key China market.”

Ives says his ‘bull case’ for Apple includes a price target of $700 per share, a value he sees as realistic given that the iPhone 12 “represents the most significant product cycle for Cook & Co. since iPhone 6 in 2014 and will be another defining chapter in the Apple growth story looking ahead despite a softer consumer spending environment in our opinion.”

“We still believe many on the Street are underestimating the massive pent-up demand around this supercycle for Apple, which remains the opportunity for the bulls heading into 2021 as this monetization engine heads into its next gear,” Ives said.

MacDailyNews Take: Yup.

Apple’s services will continue to grow and the multi-year 5G iPhone super cycle looms, as the effects from the China coronavirus wane.MacDailyNews, February 18, 2020

5 Comments

  1. if the economy keeps coming back AAPL will make it to 200/share after the split within a year. The thing to consider is apple will keep growing earnings. iPhone super cycle, new macs, iPad, iWatch, services ect …

    the top line iPad pro is still a 1month back order.

    The new Silicon (5nm TSMC) macs will be awesome and continue to grow mac sales/profit. VR/AR glasses will open a new product segment.

    Apple’s complete ecosystem continues to pull ahead of the pack.

  2. “if the economy keeps coming back”
    There’s Wall Street & then there is the “real economy.” You know, the one with 30 million unemployment claims. And 19K more pending from American Airlines, etc, etc…….

    “AAPL will make it to 200/share after the split within a year.”
    The Greater Fool Theory.

    1. joell, visitors here, like me, are pleased when AAPL rises, but few think that AAPL’s current rise is anything but logical and warranted (based on earnings) and a recovering econ, so when pointing out the market is doing poorly, or AAPL is in a bubble formation, people’s denial shows in those down votes.

      Besides the econ being fundamentally in bad shape, AAPL’s two-yr sales growth rate is 3.6% and net income increased by 2.03%/yr, but stock has risen from; $200/Aug ’19 to $500/’20 (general). The hit-in-the-head math shows a profound discrepancy.

      Most here SEEM to conflate such a statement that Apple is a bad company and doesn’t make worthy and excellent products, but even a good company can be floating in a bubble. APPL is part of a group that make up over 25% of the S & P market cap. 6 yrs ago this group (Goog, MS, FB Amzn) accounted for a 9.5% of the S & P market cap. Today, these stocks account for for 26%. These figures account for 50% gain of the S & P, since ’14. Yet, the composite net income growth rate for these 5 stocks has been 14.4% since ’14. Another “hmmm.”

      The broad market (S&P) is trading at the highest forward PE multiples since Nov 1999 and it’s well known what happened around then. With interest rates low and the Fed planning to pump more to perk up interest rates, the bubble will likely get larger and the AAPL will likely rise more. The Fed’s actions (creating/spending what’s not there), are inflationary, by rule. It seems inflation is not seen, but it’s clearly showing itself in asset inflation (stocks…incl APPL). But, that doesn’t mean its rising is based on solid market fundamentals. Bubbles pop, but WHEN is the unknown variable.

    2. Ive been in AAPL since 1998. Apple’s value now is so much more than the numbers on the book. For twenty years apple was often the victim of the haters. The P/E was always around 13. But now apple is killing it on services/hardware/software with ZERO competition across a similar united eco system. Apple is strengthening the hardware nexus now making their own silicon. Which positions them to lead innovative hardware and unmatchable wearables (in terms of innovation and profitability) which will continue to strengthen their software and services possibilities.

      Check out FCP and Logic Pro releases though they represent a super small market value they speak to the much greater high end mind power that apple develops in-house is a play ground for future consumer features. Check out the new Lidar scanner and AVR kit beta.
      “The Greater Fool Theory”

      Nope you will be proven wrong and miss out on a windfall of profits. Apple has turned the corner on the market perception and the shorts and the hatters have moved on. Apple is the gold standard of forward possibilities with an insane ability to bring ideas to market with brutal efficiency and profitability and an unmatched war chest to integrate and leap frog industries.

      Google, FB and Microsoft have tried to make VR/AR stick with little and hard fought success. Apple will sweep in and “show them how its done”. The glasses will be insane and they will be instantly profitable.

      “big bank takes little bank” – ICE CUBE

      AAPL P/E 38.38
      AMZN P/E 132.9
      NFLX P/E 92.46
      MSFT P/E 38.39
      FB P/E 37.16
      AMD P/E 167
      TSLA P/E 1,114
      GOOG P/E 36.14

  3. You conflated sir. As mentioned, there was nothing said that “Apple is a bad company and doesn’t make worthy and excellent products.” Going on/on about FCP, Logic and Lidar confirms the avg person here is not able to admit, or see that Apple is part of a market that mirrors the tech bubble of two decades ago and the current share gain is unhinged from fundamental numbers.

    The matter at hand is about inflation/inflated assets and a bubble of the tech-kind. Yes, TSLA is leading in the irrational category and…?

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