Morgan Stanley expects Apple to report all-time record earnings, ups target price

Morgan Stanley has raised its target share price for Apple to $152 from $144 ahead of what its analysts believe could be “all-time record” earnings.

Apple Park in Cupertino, California
Apple Park in Cupertino, California

Philip Elmer-DeWitt for Apple 3.0:

“We are buyers ahead of what we expect to be a record December quarter print.” — [Morgan Stanley] Analyst Katy Huberty

From a note to clients that landed on my desktop late Wednesday:

Our recent conversations suggest investors expect Apple to release solid, but not great, December quarter results. We disagree and believe that Apple is likely to report all-time record quarterly revenue and earnings.

Our checks point to strength across Apple’s entire Product and Services portfolio, and we model double digit Y/Y growth for all 5 revenue segments in the December quarter, with risk skewed to the upside for iPhone, Mac and Services.

Overall, Morgan Stanley’s December quarter revenue of $108.2B is 5% above consensus, while the firms expects EPS of $1.50, 7% above consensus.

MacDailyNews Take: On the strength of the first 5G iPhone lineup, and strong iPhone mix which will boost iPhone ASP, along with revived Mac sales, thanks to Apple Silicon-powered Macs (M1, for now) and work- school-from-home due to COVID lockdowns, and increasing Services sales, Apple is very likely to generate revenue of more than $100 billion a single quarter for the first time in the company’s history. Morgan Stanley has the right idea regarding Apple revenue for Q120.

Apple’s current quarterly revenue record was set in Q120 (calendar 4th quarter 2019) at $91.8 billion.


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