After Apple’s better-than-feared fiscal second-quarter earnings report, a J.P. Morgan analyst hiked the firm’s AAPL price target from $210 to $225 per share while maintaining an “overweight” rating.
Lee Samaha for The Motley Fool:
The upgrade follows a good set of results from the company that allayed fears over lagging iPhone sales, particularly in China. That might sound surprising in light of the fact that iPhone sales did decline 10.4% year over year in the quarter to $45.96 billion.
However, as management noted on the earnings call, last year’s fiscal second-quarter iPhone revenue was boosted by a “one-time impact” that added $5 billion to its sales, as it filled pent-up demand resulting from pandemic-related supply chain disruptions. Apple CEO Tim Cook said, “Our March quarter total company revenue this year would have grown,” excluding this impact.
The analyst also noted that the guidance for the fiscal third quarter demonstrates the strength of the iPhone franchise and sets the company up nicely for the rest of 2024. It’s hard to disagree. Management guided toward total revenue growth in the low single-digit range while expecting a 2.5% headwind from unfavorable foreign exchange movements – guidance implies as much as 5.5% organic growth.
In addition, after a 14% year-over-year increase in revenue from its high-margin services segment in the fiscal second quarter, management expects another quarter of double-digit growth. Sales gains in services continue to transform Apple’s margin profile, as gross profit margins there come in near 75%, compared to 36.6% for products. Services made up just over a quarter of Apple’s overall revenue, compared to 22% in the same quarter last year. Apple’s overall gross margins improved to 46.6% from 44.3%.
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MacDailyNews Take: Apple’s services business has now become too large for even Wall Street analysts to overlook.
Apple’s services business – the uber-sticky ecosystem – is the most overlooked segment of Apple’s insanely efficient profit-generating machine. Wall Street wants growth? Well, there it is, right in front of their faces. Hardware unit sales aren’t where the action is – for proof of that just look at Windows PCs or Android. – MacDailyNews, April 20, 2016
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[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
My opinion about the iPhones is this: People are waiting for the iPhone 16 for two reasons. 1) They want the 5x zoom in the iPhone Pro that is only available in the Pro Max at the moment. 2) AI enhancement in the iPhone 16.
My guess is that the iPhone 16 will outsell any other iPhone before. There are so many people out there that are waiting to upgrade.
Stock may go up until the pending crash due to libturd stupidity,
All signs point to a huge market crash caused by the lying, corrupt, racist, pedophile demential patient’s economy. You remember the economy, the one that was BOOMMING under Trump!?
Thanks, libturds!
Remeber how much better off this country was when people as stupid as libturds were locked up in mental institutions?
So, that’s what the problem is!
DJT voter here and WILL place another for him in Nov, BUT it’s moronic, or at best naive to blame challenging econ to the Roomba in Office, only. Inflation is the killer that affects all and Trump deserves about 1/2 of the inflation blame. In time, the Rooma in Chief will take the lead position b/c of the cost (money created) to “serve” the Border Bargers. But, let’s be honest per the pain all feel: inflation.
The benefits of a vote for Trump FAR outweigh the costs of another term for numnutts.
No, the economic polidies of the libturd installed in the White House is what torpedoed the economy.
The stupidity of libturds has consequences.
INFLATION AT SAME POINT IN PRESIDENCY
ENERGY
Trump = 0.0%
Biden = 38.8%
GASOLINE
Trump = -2.0%
Biden = 47.8%
ELECTRICITY
Trump = 3.0%
Biden = 29.3%
NATURAL GAS
Trump = -1.9%
Biden = 26.9%
GROCERIES
Trump = 3.3%
Biden = 21.1%
EGGS
Trump = -3.6%
Biden = 49.3%
MILK
TRUMP = 2.6%
Biden =15.0%
CHICKEN
TRUMP = 3.7%
Biden =23.9%
TRANSPORTATION
Trump = 2.3%
Biden =32.5%
AIRFARE
Trump = -13.8%
Biden =32.7%
PUBLIC TRANSPORTATION
Trump = -8.1%
Biden =22.2%
USED CARS
Trump = 2.4%
Biden =20.9%
APPAREL
Trump = 0.6%
Biden =13.5%
It seems that Apple is buying it back its shares after hours this afternoon. AAPL at $225 here it comes.