Apple stock overtakes Microsoft on increased AI expectations

AppleInsider

Apple's stock has risen sharply to take it ahead of Microsoft again, following investment analysts predictions of an iPhone upgrade super cycle because of Apple Intelligence.

Apple Intelligence is coming this fall

Even in pre-market trading, Apple was up 56 cents to $234.96, and when the market opened, it was on $235.20 per share. That puts Apple's market cap at $3.6 trillion, where Microsoft opened down at $3.4 trillion, cementing Apple's lead, which it took when the market closed Monday.

Apple's rising share price follows the latest reports from analysts including Morgan Stanley. The firm has generally been bullish on Apple while other analysts have shied away from it, but in its most recent reports, it named the company as its top pick for investors.

After months of small trims, Morgan Stanley has now significantly raised its target price. It's gone from $216 to $273, again specifically because of Apple Intelligence.

Back in June 2024, JP Morgan also raised its target price for the same reasons. In that case it was only a $20 raise to $245, though.

In July 2024, Wedbush went so far as to say that there would be a "monumental" upgrade cycle for the iPhone 16 range, once more because of AI. It also said that it expected Apple's share price to rise by between $30 and $40.

Wedbush has not raised its Apple target price, even after concluding that Apple Intelligence makes the company a good investment. However, its target price was already $275.

Apple is due to announce its latest earnings on August 1, 2024. None of Apple's AI initiatives have launched, and will begin to roll out slowly to the public after iOS 18 is released in the fall.



Read on AppleInsider

ssfe11

People will use any excuse to upgrade their iPhone. Now they have the ultimate excuse…Apple Intelligence. The Wedbush monumental upgrade cycle is on its way. 

DAalseth

Every time there is a big innovation people try to put it in everything. Then after a few years they realize that most of those applications were stupid*. This will be the way with AI. Right now they want it in everything, while we the customers just want a Siri that can understand linked questions and a spelling checker that won’t recommend ‘banana’ when I type ‘mountai’. I am actually glad to hear that most of the Apple Intelligence features will be rolled out separately over the next year. That way I can hunt them down and kill them one at a time. 

*This is how we ended up with asbestos modelling clay, and radium in makeup. 

p-dog

DAalseth said:

Every time there is a big innovation people try to put it in everything. Then after a few years they realize that most of those applications were stupid*. This will be the way with AI. Right now they want it in everything, while we the customers just want a Siri that can understand linked questions and a spelling checker that won’t recommend ‘banana’ when I type ‘mountai’. I am actually glad to hear that most of the Apple Intelligence features will be rolled out separately over the next year. That way I can hunt them down and kill them one at a time. 

*This is how we ended up with asbestos modelling clay, and radium in makeup. 

I have always appreciated your insightful comments over these last few years.

blastdoor

I think the long term value that warrants the higher price is the server side with private cloud compute on apple silicon. 

Not sure if that’s what Wall Street is excited about, but it’s what they should be excited about.

danox

ssfe11 said:

People will use any excuse to upgrade their iPhone. Now they have the ultimate excuse…Apple Intelligence. The Wedbush monumental upgrade cycle is on its way. 

Younger family members wanting a piece of the Apple action is my excuse "isn't it time for an upgrade?" And can I have your iPhone or your iPad?

13485

DAalseth said:

Every time there is a big innovation people try to put it in everything. Then after a few years they realize that most of those applications were stupid*. This will be the way with AI. Right now they want it in everything, while we the customers just want a Siri that can understand linked questions and a spelling checker that won’t recommend ‘banana’ when I type ‘mountai’. I am actually glad to hear that most of the Apple Intelligence features will be rolled out separately over the next year. That way I can hunt them down and kill them one at a time. 

*This is how we ended up with asbestos modelling clay, and radium in makeup. 

Just FYI, asbestos has been used in clay for thousands of years, and radium and thorium were used in makeup in the 1930s and banned in 1968, so they were not new concepts that went wrong after a few years. I get the point, though, and I agree.

dewme

DAalseth said:

*This is how we ended up with asbestos modelling clay, and radium in makeup. 

... and Furbys.

Healthy skepticism is a quality trait. 

Stabitha_Christie

DAalseth said:

Every time there is a big innovation people try to put it in everything. Then after a few years they realize that most of those applications were stupid*. This will be the way with AI. Right now they want it in everything, while we the customers just want a Siri that can understand linked questions and a spelling checker that won’t recommend ‘banana’ when I type ‘mountai’. I am actually glad to hear that most of the Apple Intelligence features will be rolled out separately over the next year. That way I can hunt them down and kill them one at a time. 

*This is how we ended up with asbestos modelling clay, and radium in makeup. 

As a customer I completely disagree. I have found Apple's AI efforts to be useful. I liked TouchID, I  like FaceID, I like afib detection, workout detection, I like the computational photography on the phone and I like subject detection in photos just to name a few. I have been fiddling with iPadOS beta and iOS beta and the improved subject detection is photos is fantastic as well as math notes in Calculator. I look forward to some of the writing tools being introduced as they have a ton of potential. 

I get your overall point, some companies have been cramming AI into things for the sake of doing it. I have found Apple's implementations to be a bit more thoughtful and the put features in whee the make sense. 

M68000

The hype around “AI” is unprecedented.  Much of it is amazing marketing at work.  I just saw some new Microsoft(R) surface equipment at work.  It now has a dedicated “co-pilot” key on keyboard.
 .  Sorry, computers do not think for themselves.
 I’m not sure that they ever should.