Rothschild & Co Redburn has upgraded Apple (AAPL) to Buy from Neutral and raised its price target to $400 from $260, citing stronger-than-expected iPhone growth driven by the company’s planned entry into the premium foldable smartphone market.
Analyst Timm Schulze-Melander and the firm project iPhone sales growing at a 12% compound annual rate through fiscal 2030 — up to 14% above consensus expectations. The key catalyst is the anticipated launch of the iPhone Ultra, Apple’s first foldable device, expected to expand the premium segment and lift average selling prices.
Rothschild forecasts the foldable model will contribute meaningfully to unit growth with limited cannibalization of traditional iPhone sales. The firm’s iPhone earnings estimates run ahead of consensus, and a “strategic reset” in Apple Intelligence further supports its outlook, leaving overall fiscal 2030 estimates roughly 18% above the Street. Rothschild expressed confidence that Apple’s relative valuation multiple remains well supported.
Beyond hardware, the firm sees opportunity for Apple to position itself as a gatekeeper of consumer AI. By potentially leveraging a fleet of open-source models and monetizing through Apple Pay and other payment platforms, Apple could strengthen its high-margin Services business while reducing reliance on third-party closed models.
The upgrade comes as Apple trades near recent levels around $305, implying significant upside to the new $400 target. While risks such as production challenges for the foldable device remain, Rothschild views the combination of product innovation and AI optionality as underappreciated by the market.
MacDailyNews Take: From Schulze-Melander’ lips to Mr. Market’s ears!
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Wrong, can’t see the Signs? The problems are evident. The new products won’t change the facts. They are just pushing the stock to lure people, won’t work. went down $40 since the high. Bah
apple needs a robot.
like OpenAI’s donut robot in development.
that’s the next big thing.
an AI companion
Maybe the upgrade will be supported–more so–because of AAPL’s position with AI?
The Frontier AI models and hyper-scalers are spending boatloads of money and there are questions if they will be able to monetize the spending. Plus, regs will likely crimp and many propose the “machinery” will be commoditized and, or the open source (now China) models will prevail.
Meanwhile AAPL is on the “sidelines” with the eco-system/network of users and (hopefully Siri’s idiot days are over) ready to serve AI to the masses?
https://limitededitionjonathan.substack.com/p/apple-is-the-king-of-ai-and-nobody?utm_source=multiple-personal-recommendations-email&utm_medium=email&triedRedirect=true
That is exactly what people don’t realize about Apple – the efficiency of these machines and the on device AI is going to kick everyone’s ass. Only going to get better for Apple – Surprised we don’t see data centers filled with Apple hardware – think of the energy savings.