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Saturday, August 13, 2022

Apple: Still a Top Tech Stock to Own, Says 5-Star Analyst

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Apple (AAPL) appears confident the iPhone 13 is destined for success. According to Asian supply chain checks made by Wedbush analyst Daniel Ives, iPhone 13 builds are currently in the ~90 million unit range.

This represents an approximate ~10% uptick year-over-year “out of the gates,” when compared to the initial build of 80 million iPhone 12s.

“While this number will clearly move around over the coming months (chip shortage volatility adds to it), we believe this speaks to an increased confidence with Cook & Co. that this 5G driven product cycle will extend well into 2022 and should also benefit from a post vaccine consumer ‘reopening environment,’” said the 5-star analyst. Timing wise, Ives expects the new iPhone will be launched in the third week of September.

What can Apple’s global fanbase expect? Ives is increasingly confident the iPhone 13 will have an “eye-popping” 1 terabyte storage option. This more than doubles the current highest Pro storage capacity (512GB). Several “key enhancements” will also be in store with all iPhone 13 models boasting Lidar scanning abilities.

The iPhone 13 upgrade cycle will get a boost from the “key” Chinese region, with roughly 20% of upgrades expected to come from China. But the far east is not the only region with “massive pent-up demand within Apple’s installed base.” Across the globe, Ives estimates 250 million of the current 975 million iPhone users have not upgradeed their smartphones over the past 3.5 years, which bodes well for the launch.

With the year’s final stretch coming into view, Ives thinks the “tech bull cycle” is by no means exhausted. And if there’s one name investors should add to their portfolio, betting on the world’s largest company by market cap might not be a bad idea.

“Our favorite large cap tech name to play the 5G transformational cycle is Apple, with the 1-2 punch of its massive services business and iPhone product cycle translating into a $3 trillion market cap for Cupertino in the next 6 to 12 months in our opinion,” Ives summed up.

There’s no change, then, to Ives’ rating, which remains an Outperform (i.e., Buy), or price target, which stays at $185. Investors are looking at returns of 26%, should the target be met over the next 12 months. (To watch Ives’ track record, click here)

Amongst Ives’ colleagues, current support for Apple is decent but not conclusive. Based on 19 Buys, vs. 5  Holds and 2 Sells, the stock has a Moderate Buy consensus rating. The average price target clocks in at $162.32, suggesting one-year gains of ~10%. (See Apple stock analysis on TipRanks)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment

The post Apple: Still a Top Tech Stock to Own, Says 5-Star Analyst appeared first on TipRanks Financial Blog.

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