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Apple shares are above $ 136.69, reached on December 28, 2020.
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Apple
equities are rising more as investors accumulate in megacap technology stocks ahead of the next wave of earnings reports in the December quarter. Apple will report results on Wednesday, January 27, and expectations on the street are growing stronger, leaving its shares just a few points below their all-time highs.
Morgan Stanley analyst Katy Huberty on Thursday reiterated her overweight rating on Apple shares and raised her price target to $ 152 from $ 144. She writes that her verifications show that Apple registered strength in its portfolio of products and services in that quarter, determined by the adoption of iPhone 5G, the tendency to work and learn from home and the commitment sustained with the App Store.
“We are buyers ahead of what we expect to be a record print in the December quarter,” Huberty wrote in a research note. “Our recent conversations suggest that investors expect Apple to launch solid, but not great, results in the December quarter. We disagree and believe that Apple is likely to report record and quarterly revenue of all time. ”
Huberty expects double-digit revenue growth in all revenue segments, with “low growth risks” for the iPhone, Mac and Services. Its revenue estimate for that quarter is $ 108.2 billion, well above consensus, at $ 102.6 billion. She sees profits for the December quarter of $ 1.50 a share, above the street at $ 1.40. (Note that the company did not provide any guidance for this quarter, citing the uncertainty associated with the pandemic.)
“We expect the strength of demand to continue and the tax revenues from 2021 and EPS estimates are both 5% above consensus,” she writes. “Given the quarterly positioning is off after the rotation of high-quality stocks over the past few months, we expect strong post-earnings tracking.”
Huberty believes the iPhone 12 has been Apple’s most successful product launch in five years. It forecasts 78 million iPhones delivered in the quarter at an average selling price of $ 825, delivering a 14% increase in revenue to $ 63.9 billion – twice the growth rate that Consensus Street projects in present for iPhone revenue. And the momentum for iPhones is expected to continue until 2021. She notes that Taiwan’s supply chain partners have had three consecutive months of accelerating year-over-year sales growth, which she believes indicates strong iPhone sales in the following quarters.
DA Davidson analyst Tom Forte reiterated his buy rating per share, noting that the stock looks “delicious”, although it has exceeded its $ 133 price target. (He says his target is “under review,” pending next week’s earnings report.) Forte also has over-consensus estimates for the quarter – seeing $ 106.2 billion in sales with $ 1.52 per share. “We believe that Apple’s first line of smartphones on 5G networks is better positioned than investors fully appreciate,” he wrote in a research note.
Monness Crespi Hardt analyst Brian White also repeats his buy rating, while maintaining the $ 144 target price. White’s estimates require sales of $ 105.3 billion and profits of $ 1.47 per share. “The power and linearity of this economic recovery remains a wildcard; however, we believe that Apple’s strong balance sheet, iconic brand, fast-growing service business, line of innovation and strong position on personal privacy will allow the company to emerge stronger from this crisis, ”he writes.
Apple shares rose 3.1% to $ 136.10 in recent transactions. Shares increased by more than 6% in the first two days of the Biden Administration, increasing its market capacity in this short period by 133 billion dollars. The stock is at a low of $ 136.69, reached on December 28, 2020, as well as the intraday record high of $ 138.79, which it reached on December 29. Apple shares have a market valuation of $ 2.278 trillion, and Apple remains the most valuable company in the world.
Write to Eric J. Savitz at [email protected]