Apple Shares Could Surge Another 27%, Says Wedbush Analyst

[MacRumors]

After reaching a market value of two-trillion dollars earlier this week, Apple may yet surge by another 27 percent, according to Wedbush analyst Daniel Ives (via BusinessInsider).

Ives believes that Apple has the potential to make further significant gains over the next year, even though the company has already hit the milestone two-trillion dollar valuation. He has classified Apple stocks with an "outperform" rating, with a target price of $515 and an optimistic bull case of $600. This prediction would place Apple as much as 27 percent higher than it closed yesterday.

"We still believe the stock has a lot of gasoline left in the tank with an iPhone 12 'supercycle' on the near term horizon," Ives wrote.

Ives described the possibility as a "once in a decade" opportunity, as "we estimate roughly 350 million of Cupertino's 950 million iPhones worldwide are in the window of an upgrade opportunity." He believes in "massive pent-up demand around this supercycle," which is the main indication that Apple's price could surge going into next year. China is also crucial to Ives' analysis, where he sees "considerable strength" that could account for approximately 20 percent of iPhone upgrades over the next twelve to eighteen months.

Beyond the iPhone, Ives' thesis places considerable emphasis on Apple's increasing services ventures, which he values between $700 billion to $750 billion. He believes that Apple services could generate more than $60 billion in annual revenue next year alone. He also recognizes the boom in wearables, such as AirPods and Apple Watch, which have seen an increase in sales of 25 million units this year.

Article Link: Apple Shares Could Surge Another 27%, Says Wedbush Analyst

 

[routine_analyst]

Wonder how much investment Daniel Ives has in Apple stock? Telling all the stupid people that it's bound to keep going up might get them to buy in... has Apple secretly invented the cure to cancer? The services business is the area of growth and the company still offers (more or less) a similar product lineup after 5 years.

 

[nylonsteel]

do your due diligence when investing
no one can predict the future
its your money

 

[dlewis23]

It's already added another 100 billion in value with in 2 days of being worth 2 trillion, currently at 2.1 trillion dollar value. With what we think is coming down the road and with how many people are actually invested in the company I really don't think its unrealistic that sometime in 2021 there is a headline on Macrumors of Apple being the first 3 Trillion dollar company.

 

[btrach144]

Not if the justice department steps in. That could set Apple back for a couple of years.

 

[Andres Cantu]

Apple has added $440 billion to its market cap over the last month, which is more than the current market cap of 493 companies in the S&P 500.

I like Apple products, but this won't end well. Top-heavy S&P 500 is just like the dot-com bubble. The rest of the companies need to participate in the growth, unless they want the whole US to work for just 5 companies.

 

[TheYayAreaLiving 🎗️]

Wow so much growth Apple is seeing! It’s crazy

 

[darkslide29]

When Apple dropped to about $300ish, I had some cash sitting in a trading account and bought S&P stock to not put all my eggs in one basket. Decent gains, but not Apple or Tesla level gains. When Apple hit $400, I had regrets. Now that Apple is near $500, more regret lol.

 

[cardfan]

Market is basically fed fueled right now. When fed stops buying debt down they’ll go.

 

[kcslc]

When Apple dropped to about $300ish, I had some cash sitting in a trading account and bought S&P stock to not put all my eggs in one basket. Decent gains, but not Apple or Tesla level gains. When Apple hit $400, I had regrets. Now that Apple is near $500, more regret lol.

I guess we’ll see. We are in the middle of a pandemic, with massive unemployment. I doubt as many people are going to be upgrading this year, since a lot of people can’t even pay rent. Should be interesting to see what happens to the stock price. Although, what do I know.

 

[FightTheFuture]

I like Apple products, but this won't end well. Top-heavy S&P 500 is just like the dot-com bubble. The rest of the companies need to participate in the growth, unless they want the whole US to work for just 5 companies.

Jim Cramer mentioned the other day that the reason the top tech companies are skyrocketing during this pandemic is that they’re simply in a better position while smaller companies are struggling. Have to work from home? Buy a new MacBook. Stores are closed? Buy everything on Amazon. Stuck at home? Subscribe to Netflix. It’s demand + serendipity. It shouldn’t and probably won’t hold - I mean I doubt every TSLA shareholder thinks it’s priced correctly right now.

 

[Shirasaki]

Is THIS really what customer and shareholder want Apple to be? To become a corporation that can literally run a whole country? What’s next? $3 Trillion in 4 weeks? The stock market is supposed to be reflecting the economy, but right not it is not.

Idk. This doesn’t feel right but who knows what the impact could be. The only thing I know is growth like this magnitude won’t last forever.

 

[Andres Cantu]

Jim Cramer mentioned the other day that the reason the top tech companies are skyrocketing during this pandemic is that they’re simply in a better position while smaller companies are struggling. Have to work from home? Buy a new MacBook. Stores are closed? Buy everything on Amazon. Stuck at home? Subscribe to Netflix. It’s demand + serendipity. It shouldn’t and probably won’t hold - I mean I doubt every TSLA shareholder thinks it’s priced correctly right now.

I don't disagree with that. I think at some point unemployment catches up. There's been a lot of demand pulled forward from the future due to the extra unemployment benefits. A lot of people needed them, but there's also a lot of people that didn't and spent it all on tech items.

 

[Rogifan]

The dreaded “super cycle” phrase ugh. I get there were a lot of people who wanted a bigger iPhone but how many really care about 5G?

 

[carlhancock]

The services business is the area of growth and the company still offers (more or less) a similar product lineup after 5 years.

The migration to 5G is going to see sustained longterm growth. It may be delayed because of the pandemic situation. But just like people migrated from Edge to 3G and 3G to 4G we are about to enter another upgrade cycle related to cellular technology improvements. So iPhone sales will begin to grow as this upgrade cycle unfolds and people that have held off on upgrading or don't upgrade as often as power users will be more likely to upgrade. This won't be a mad dash to buy the iPhone 12. It will be a cycle that lasts a couple years as 5G grows just like 4G, 3G, and Edge before it.

 

[DelayedGratificationGene]

Wall Street is just finally realizing and pricing in how impressive Apples future earnings will be with 5G, AR, health innovations etc...once Apple showed it’s not just an iPhone company but A company with recurring services revenue and new innovative products etc the market gave this consumer staple a new multiple

 

[Jmausmuc]

I don't disagree with that. I think at some point unemployment catches up. There's been a lot of demand pulled forward from the future due to the extra unemployment benefits. A lot of people needed them, but there's also a lot of people that didn't and spent it all on tech items.

The Us is doomed.
Most people actually revived more in unemployment benefits than they would have gotten from working.

The FED is throwing money left and right, putting a bad-aid on a larger problem.

this is going to end incredibly bad. Too bad the US is a major economic powerand will drag down everyone else with their ludacris monetsry policies.

 

[cardfan]

Is THIS really what customer and shareholder want Apple to be? To become a corporation that can literally run a whole country? What’s next? $3 Trillion in 4 weeks? The stock market is supposed to be reflecting the economy, but right not it is not.

Idk. This doesn’t feel right but who knows what the impact could be. The only thing I know is growth like this magnitude won’t last forever.

Well yeah. That’s what every shareholder wants. Lol.

The stock market isn’t supposed to reflect anything but what people buy and sell. Of course it doesn’t feel right because the fed is take unprecedented steps to prop it up.

Unprecedented. Buying corporate debt at any yield or rate. This is trillions. It makes what meager trillions congress argues about pale in comparison.

This is in addition to zero percent interest rates. The fed basically has guaranteed stocks will go up. Once people wrapped their heads around this a few months ago they stayed the course. Risk? What risk. Fed has your back.

It’s not as if Apple has done anything remarkable itself to warrant such a sharp increase. Imagine if Apple was a cruise company. Even Tim Cook isn’t turning that ship around.

 

[ghanwani]

Apple is headed to $10T (about $2500 in today's stock price) within 3 years, possibly 2. My research/justification boils down to:
- HUGE tailwind from the fed leading to massive P/E expansion. We are at ~33 today, 100 is easily doable. That's a $6T market cap.
- Fed support doesn't end there. Apple is also tapping the bond market selling bonds at ridiculously low interest for 30-40 years and using that to buy its stock. Who's buying these bonds? The Fed! This money is being used to buy back Apple stock. That could double the above and make it a $10T company.
- Lots of other positive stuff -- move to Arm, going after untapped market in India, excellent product pipeline, everyone hates android because of privacy, etc., but that is unlikely to have that much impact to earnings. However, that is what will give it brand cachet to justify the above P/E expansion.

Take my poll here:

How long will it take for Apple to reach a market cap of $10T?

Apple's market cap is now close to $2T. How long will it take to get to $10T? Keep in mind that the fed is in "whatever it takes" mode until the economy "recovers", and that, right now, is being put at around 2024. (Keeping the poll simple and uncomplicated, just like everything Apple does.)

forums.macrumors.com

 

[jayducharme]

Good news to hear right before the stock split!

 

[Andres Cantu]

The Us is doomed.
Most people actually revived more in unemployment benefits than they would have gotten from working.

The FED is throwing money left and right, putting a bad-aid on a larger problem.

this is going to end incredibly bad. Too bad the US is a major economic powerand will drag down everyone else with their ludacris monetsry policies.

Agreed. I think what will happen is a lost decade, and the stock market will mirror what happened to Japan's Nikkei. For decades, investors have been conditioned to expect a positive return. But it doesn't always happen that way.

 

[Baymowe335]

Apple has added $440 billion to its market cap over the last month, which is more than the current market cap of 493 companies in the S&P 500.

I like Apple products, but this won't end well. Top-heavy S&P 500 is just like the dot-com bubble. The rest of the companies need to participate in the growth, unless they want the whole US to work for just 5 companies.

Apple’s earnings have zero in common with the dot com bubble stocks.

Apple trades at 33X earnings, which is completely reasonable with a $55B services income stream and 600M paid subscribers with 1.5B active devices.

Apple has just started to get the same respect MSFT got when their multiple expanded. Apple also makes a lot more profit than MSFT.

The only big ones looking super bubbly are TSLA and perhaps AMZN and NFLX.

 

[ghanwani]

Agreed. I think what will happen is a lost decade, and the stock market will mirror what happened to Japan's Nikkei. For decades, investors have been conditioned to expect a positive return. But it doesn't always happen that way.

This is exactly what people were saying 10 years ago and yet the market has tripled since then.

 

[Pootie Tang]

The national debt ($26.578 Trillion) now exceeds the size of the gross domestic product. That was always considered to be a doomsday scenario that would wreck the economy. That hasn't happened yet but its definitely a warning sign. And the next stimulus bill with at least a trillion more in government spending is on the horizon.

 

[Cosmosent]

Munster, Ives, Huberty, & Cramer are ALL "AAPL Cheerleaders" masquerading as so-called Pro Stock Analysts !

Those who write for MR should know that !

There are three good / legit ones:

● Toni Sacconaghi
● Jeffrey Kavaal
● Dan Niles