Apple stock should return to $130 by end of 2015, says Brean Capital

Posted:
in AAPL Investors edited November 2015
Apple stock should bounce back to $130 by the end of the year, helped by solid iPhone sales and high profit margins, a Brean Capital research memo argued on Monday.




Brean's latest forecasts call for Apple to ship 47 million iPhones in the September quarter, and 72 million in the December quarter, according to analyst Ananda Baruah. Gross margins are predicted to hit 39.8 percent and 40.4 percent respectively, above Wall Street consensus estimates of 39.3 and 39.8.

Those numbers could deliver estimated earnings-per-share figures of $2 and $3.29, over consensus predictions of $1.87 and $3.19.

In general Street figures are too low through 2017, Baruah said. Aside from high margins and better iPhone performance -- including more 6 Plus sales than anticipated -- the company should theoretically have more operational expenditure leverage in 2016 as it benefits from Apple Watch and iPhone investment cycles.

Baruah also pointed to spikes from several upcoming products, including not just the "iPhone 6s" -- which should be announced Sept. 9 -- but also a 12.9-inch iPad, and ultimately an iPhone 7 in 2016. The analyst speculated that the latter could have features such as a wraparound screen and "no touch" gesture commands via Apple's acquired PrimeSense technology.

Another suggestion was that Apple could reinvigorate the iPhone lineup with a new, smaller form factor in the middle of 2016. The view echoes some recent rumors that Apple is working on an "iPhone 6c" with the specifications of the iPhone 6, but a 4-inch screen like the iPhone 5s. Such a device could be revealed on Sept. 9, but recent reports have hinted that the product will be delayed if it launches at all.

Baruah is calling for a $170 price target for Apple stock. Shares have taken a beating in recent weeks, falling from $132 in July to $114 in early Monday trading. In August much of this was linked to economic problems in China, though deliberate comments by Apple CEO Tim Cook have helped prices bounce back.
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Comments

  • Reply 1 of 34
    sirlance99sirlance99 Posts: 1,143member
    sog35 wrote: »
    LOL.  It will be $130 by end of October

    $150 by EOY

    Haha! No chance at all. It will not be $150
  • Reply 2 of 34
    schlackschlack Posts: 697member
    seriously. will be 130 by end of september.

    but you know. doom! doom! doom!
  • Reply 3 of 34

    The cynic in me says that the Anal(ists) have got tired with shorting the stock and now want to 'big' it up.

    What goes up, must come down.

    I predict a whole raft of downgrades after the announcements next week.

    I don't directly own any Apple stock but sometimes these soothsayers need to get well and truly shafted financially.

  • Reply 4 of 34

    These time-bound price forecasts (including the various posts and counter-posts above) are laughable.

     

    There's nothing in known economics to enable someone to be able to confidently say 'what' and 'when' at the same time with such specificity. Period.

     

    It's weird how people conflate luck and skill all the time. 

  • Reply 5 of 34
    fallenjtfallenjt Posts: 3,976member
    sog35 wrote: »

    If there was a time for downgrades it would have been the last 2 weeks based on China weakness.

    No one is expecting some blowout announcement next week.

    The next possible event that could cause a downgrade is late October with earnings.  If Apple guides to negative revenue growth we could see some downgrades.
    $130 here we come....if Apple event is overwhelming with ATV and...wishful Apple car. I don't care if iPhone 6S
  • Reply 6 of 34
    fallenjtfallenjt Posts: 3,976member
    sog35 wrote: »
    The amount of possible new billion dollar revenue streams with Apple is amazing.

    Watch - $50 billion potential
    TV - $100 billion potential 
    iPad Pro
    Car
    Enterprise
    VR

    Its totally crazy how much potential growth Apple can achieve.  Then look at Google.  None of their new ventures look like they will even come to fruition.  Their Car has a chance but Google is not a premium brand so people will expect it to be dirt cheap.  Glass is a fail.  Immortality?  Really?  Hot air balloons.  Ect.  
    Google Fiber and the love from WS...?
  • Reply 7 of 34
    paul94544paul94544 Posts: 1,027member

    Not $150 EOY.

     

    Would you like to wager $200 on that?

     

    Put your money where your mouth is, If you don't take that bet then stop making wild assertions

  • Reply 8 of 34
    SpamSandwichSpamSandwich Posts: 31,198member

    Hahaha... Not enjoying the middling performance of the stock, but eagerly awaiting the 1 year self-ban of Sog (surely a lock since his "challenge" was accepted by "patpatpat"). It'll be like a breath of fresh air.

  • Reply 9 of 34
    SpamSandwichSpamSandwich Posts: 31,198member
    Quote:

    Originally Posted by anantksundaram View Post

     

    These time-bound price forecasts (including the various posts and counter-posts above) are laughable.

     

    There's nothing in known economics to enable someone to be able to confidently say 'what' and 'when' at the same time with such specificity. Period.

     

    It's weird how people conflate luck and skill all the time. 




    Such as "$150 by end of 2015"... What was he thinking? LOL!

  • Reply 10 of 34
    Quote:
    Originally Posted by SpamSandwich View Post



    Such as "$150 by end of 2015"... What was he thinking? LOL!


    You're missing my point: You also cannot equally confidently say that "it will not get to $150 by the end of 2015."

  • Reply 11 of 34
    sirlance99sirlance99 Posts: 1,143member
    sog35 wrote: »
    Haha!  And you know this how? Crystal ball?

    I could ask the same as you.
  • Reply 12 of 34
    SpamSandwichSpamSandwich Posts: 31,198member
    Quote:

    Originally Posted by anantksundaram View Post

     

    You're missing my point: You also cannot equally confidently say that "it will not get to $150 by the end of 2015."




    That's right. I'd be confident it will hit $150 at some point in the not-too-far-off future, but I'd not stake my reputation on a definite date.

  • Reply 13 of 34
    joshajosha Posts: 901member

    I'd like another dip in Apple's price.  The last one was too quick for me to react adequately.  :\

     

    As for a 4" iPhone like the 5, I got mine a few months ago.  

    A clear out of old stock, a new  iPhone 5c 16GB which Apple stopped selling.  I paid $50 less than the 8gb model.

    Yes it's my size, as long as my very good close vision lasts !  ;)

  • Reply 14 of 34
    mstonemstone Posts: 11,510member

    I don't know why AI even bothers to put the AAPL stock ticker in the header. It is not working most of the time.

  • Reply 15 of 34
    SpamSandwichSpamSandwich Posts: 31,198member
    Quote:

    Originally Posted by mstone View Post

     

    I don't know why AI even bothers to put the AAPL stock ticker in the header. It is not working most of the time.




    Hasn't worked for my browser for many months.

  • Reply 16 of 34
    mstonemstone Posts: 11,510member
    Quote:
    Originally Posted by sog35 View Post

     

     

    it works.  Just delayed by 30-45 minutes


     

     

    it was showing 112 all day even when it was at 114.



    It often displays NaN (not a number).

  • Reply 17 of 34
    robin huberrobin huber Posts: 3,269member
    Is Brean smoking crack? Since when have increased sales and high profit margins driven AAPL anywhere but down? Apple stock rises independent of traditional good news.
  • Reply 18 of 34
    dcj001dcj001 Posts: 301member



    My price target for AAPL by 12/31/15 is $165 per share.

  • Reply 19 of 34
    jony0jony0 Posts: 269member
    Quote:

    Originally Posted by JoshA View Post

    I'd like another dip in Apple's price.  The last one was too quick for me to react adequately.  :\


     

    Get ready, there should be 3 more dips before the year end :


    • September 9th around 2-3 PM Pacific time

    • October iPad event, same time of day

    • Mid to late October around 5 PM Eastern just before Earnings call.

    Great new products and features announcements are almost always rebuffed and dismissed as same old stuff, new products are misunderstood and ridiculed before ultimately being unapologetically copied later, and record setting numbers at Earnings call will always have at least one WS concocted miss to justify the stock's nose dive. This recurring phenomenon even has a name, it's called the Apple slingshot. I was going to catch a ride on it this time but unfortunately my other stocks that I was going to cash in went underwater at the time so I had to hold my nose. A great missed opportunity.

  • Reply 20 of 34
    joshajosha Posts: 901member
    Quote:

    Originally Posted by Jony0 View Post

     
    Quote:
    Originally Posted by JoshA View Post

    I'd like another dip in Apple's price.  The last one was too quick for me to react adequately.  :\


     

    Get ready, there should be 3 more dips before the year end :


    • September 9th around 2-3 PM Pacific time

    • October iPad event, same time of day

    • Mid to late October around 5 PM Eastern just before Earnings call.

    Great new products and features announcements are almost always rebuffed and dismissed as same old stuff, new products are misunderstood and ridiculed before ultimately being unapologetically copied later, and record setting numbers at Earnings call will always have at least one WS concocted miss to justify the stock's nose dive. This recurring phenomenon even has a name, it's called the Apple slingshot. I was going to catch a ride on it this time but unfortunately my other stocks that I was going to cash in went underwater at the time so I had to hold my nose. A great missed opportunity.


    Very good suggestions.  I may give it a try, although I doubt the dip will be as great.  It does seem stuck now, great.

    I sold some at over $130, then was considering buying it back at around $100.

    Things just happened to fast, as I was involved in other activities at the time.

     

    These Apple events like market insiders happy, stock prices bouncing around is how they profit and we just tag along.

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