Wedbush raises Apple stock target to $190 on rising demand

AppleInsider

Citing signs of rebounding demand for iPhones in China, expected new products, and an anticipated rise in services, Wedbush has again raised its Apple stock price target.

At the start of 2023, Wedbush lowered its Apple price target from $200 to $175, saying that while Apple was in a strong position, it was facing uncertain economic environments. Following Apple's latest financial results in February, it raised the price to $180, and has now again increased it to $190.

In a note to investors seen by AppleInsider, Wedbush describes Apple as now being "a steady Cupertino ship in rough macro waters."

The description and the rise in the price follows how Wedbush's "Asia iPhone supply chain checks this week have been incrementally more positive." The firm's survey shows "a modest uptick in demand coming out of China... with a clear demand rebound happening in this key region post December despite the uncertain macro backdrop."

Wedbush analysts also say that there is no sign of any significant cuts in iPhone production, "which is a good sign that shows a steady demand curve on the flagship iPhone 14 Pro."

Looking ahead, Wedbush says that "a number of levers potentially abound for Apple." Those include "noteworthy" new announcements, including an Apple AR headset "launch by the summer", and "hardware subscription plan [being] unveiled."

Alongside a potential hardware subscription plan, though, Wedbush expects "some new hardware launches on the Mac product line in 2023."

iPhone 15 expected to have a smoother launch than iPhone 14

The company also believes that the next iPhone is likely to do well. That is partly because "we estimate roughly 25% of the current iPhone installed base has not upgraded their iPhone in 4 years+," but there is more reason to expect a rise in sales.

"With the highly anticipated anniversary edition iPhone 15 set to be launched in the September timeframe," says Wedbusy, "the baton handoff from iPhone 14 to iPhone 15 looks to be a steadier transition than some other peak to valley iPhone cycles of the past."

The firm isn't expecting a commemorative edition of the iPhone when it speaks about "anniversary." Rather, it appears to be referring to the annual release cycle.

Wedbush also predicts that Apple's "Services business [is] set to see an acceleration in FY24," and that this comes from "another 100 million+ new iPhone users... added over the last 15 months."

"The golden installed base of Apple is creating more stability in this uncertain macro and remains key to our bullish thesis," say the firm's analysts.

Wedbush's reasoning behind its price rise is close to identical to the equally positive report JP Morgan recently released.



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lkrupp

Yeah, I would be worried about “high demand” in China. Tensions between China and the U.S. are rising daily it seems and if Xi decides to send lethal aid to the Russians in Ukraine it could be all over. Then we have all the blathering about a potential multi-multi-billion Euro fine in the EU as well as draconian regulation. Governments worldwide appear to have set their sites on Apple’s cash as a means of funding their corrupt operations. Just saying.

danox

lkrupp said:

Yeah, I would be worried about “high demand” in China. Tensions between China and the U.S. are rising daily it seems and if Xi decides to send lethal aid to the Russians in Ukraine it could be all over. Then we have all the blathering about a potential multi-multi-billion Euro fine in the EU as well as draconian regulation. Governments worldwide appear to have set their sites on Apple’s cash as a means of funding their corrupt operations. Just saying.

Apple is doomed again? Eastern Asia, China, Japan, and Korea have demonstrated they will buy quality first tier western products. They just won’t buy the second and third tier products, Apple isn’t divorced from the world, if China, were to go down, most of the world, would go down with it in terms of a economic depression for a few years.

Russia made their bed, and they will not come out of the Ukraine fiasco without losing even more economic strength, China in the end will help themselves to a greater part of eastern Russia, which the European Russians are vacating moving back west towards Moscow.

montrosemacs

JP234 said:

$190 price target for Apple Inc. Same as Morgan Stanley.
What is never mentioned is "over what time period?" If it's over a week, that's dramatically different than over a year. Or is $190 a point at which Apple stock is fully valued and has no room to go higher and should be sold? If I'd followed that advice, over the last 10 years I'd have lost over $100,000 by selling when Apple hit previous price targets.

Buy it. Hold it. Put your kids through college.

Indeed. The one and only great bet my wife and I made in the investment game was purchasing a ton of APPL within a month of SJ’s return to Apple in 1997. Have held it ever since, and we put two kids debt-free through 4 years of college. It was particularly nice when the stock split 7-to-1 in 2014 when it hit $700/share, and later a 4-to-1 split in 2020. Now we have a ton of shares. Will be very nice if it ever hits $190/share, but I’ll believe it when I see it. Anyway, thanks Apple!

red oak

JP234 said:

$190 price target for Apple Inc. Same as Morgan Stanley.
What is never mentioned is "over what time period?" If it's over a week, that's dramatically different than over a year. Or is $190 a point at which Apple stock is fully valued and has no room to go higher and should be sold? If I'd followed that advice, over the last 10 years I'd have lost over $100,000 by selling when Apple hit previous price targets.

Buy it. Hold it. Put your kids through college.

Price targets are almost always 12 months 

davidw

montrosemacs said:

JP234 said:

$190 price target for Apple Inc. Same as Morgan Stanley.
What is never mentioned is "over what time period?" If it's over a week, that's dramatically different than over a year. Or is $190 a point at which Apple stock is fully valued and has no room to go higher and should be sold? If I'd followed that advice, over the last 10 years I'd have lost over $100,000 by selling when Apple hit previous price targets.

Buy it. Hold it. Put your kids through college.

Indeed. The one and only great bet my wife and I made in the investment game was purchasing a ton of APPL within a month of SJ’s return to Apple in 1997. Have held it ever since, and we put two kids debt-free through 4 years of college. It was particularly nice when the stock split 7-to-1 in 2014 when it hit $700/share, and later a 4-to-1 split in 2020. Now we have a ton of shares. Will be very nice if it ever hits $190/share, but I’ll believe it when I see it. Anyway, thanks Apple!

Also purchased AAPL in 1998 when Jobs return (and some more again in 2003). We also enjoyed  2-1 splits in 2000 and 2005. But don't forget to mention the dividend AAPL started paying in 2012 (when Cook took over as CEO). It wasn't a lot percentage wise, but when you have a lot of shares, it adds up.

For the past 10 years of my retirement (retired in 2010) my income from my pension plus AAPL dividend comes to more than my salary at the time I retired. And since I'm paying the lower 15% tax rate on qualify dividend (on my Fed return), my after tax income is significantly more now, than when I first retired. Though CA taxes long term capital gains and dividend as regular income, no tax break there. But at least my AAPL shares have allowed me to afford to stay in CA. Several of my retired  friends had to move out of CA (or already had plans to move out of CA when they retire), in order to afford a more comfortable retirement. (Most of them took advantage of the $500,000 ($250,000 for single) of tax free capital gains by selling their home, buying a much cheaper and better home in another State and still ended up with all or most of that $500,000 in their retirement accounts.) 

To put it in perspective, one share of AAPL at $20 in 1998 is now worth 112 shares of AAPL at $153 (over $17,000), plus 10 years of dividend.