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Estimates raised on Wall Street as Apple impresses investors again with another record quarter

The iPhone continues to drive growth at Apple, once again propelling the company to a record quarter that has left analysts on Wall Street confident the company's stock will continue to go higher.


The New York Stock Exchange, credit Carlos Delgado via Wikipedia.


Following Apple's blockbuster March quarter, in which it sold 61.17 million iPhones and earned $13.57 billion in revenue, analysts issued their reactions, and AppleInsider offers a roundup of some of the highlights.

RBC Capital Markets



"Don't get altitude sickness yet," analyst Amit Daryanani said in a note to investors, "We are going higher."
Following Apple's March quarter, price targets were raised by RBC, Morgan Stanley, Piper Jaffray, Brean Capital, and Wells Fargo.
Following the March quarter results, Daryanani raised his price target on shares of AAPL to $150, up from his previous target of $142.

He sees sustained iPhone momentum, room for gross margin improvements, a potential revamped Apple TV, and contributions from the Apple Watch all propelling the stock in the near term.

"AAPL reported another blowout quarter across the board and we think fundamentals are going to get better from here," he said.

Morgan Stanley



While the iPhone continues to be the "main attraction" at Apple, analyst Katy Huberty told investors that she believes there is "more to come" from the world's largest company.

Accordingly, she has also increased her price target to $166, up from a previous prediction of $160.

In particular, Huberty noted that with only 20 percent of the current iPhone installed base upgraded to the latest iPhone 6 or iPhone 6 Plus, the current product cycle still has plenty of room for growth. Morgan Stanley's own survey data suggest that more than half of iPhone users will be due for an upgrade during the so-called "iPhone 6s" product cycle.

She also expects that demand for the Apple Watch will accelerate in the coming months. And despite comments saying that margins for the wrist-worn device will be lower than the company's current average, Huberty believes margins will improve to the mid-40-percent range once the product ramps up to larger volumes.




Piper Jaffray



To analyst Gene Munster, Apple's guidance for the current June quarter implies that market share gains for the iPhone 6 and iPhone 6 Plus will continue into the summer.

"We believe the iPhone unit strength is another sign of the iPhone 6 cycle's fundamental difference from prior upgrades, given the size increase of the screen," Munster wrote. "If you look at the high end of the market, the iPhone share gains are more pronounced."

Piper Jaffray also tweaked its AAPL price target, raising it by $2 to $162, following the March quarter results.

Brean Capital



Though coverage of Apple from Brean Capital only just began this month, analyst Ananda Baruah has already increased his price target from $160 to $170.

He said Apple's March quarter results are "proof positive" that the company is on track to outpace Wall Street expectations in the coming years.

His forecasts through 2017 call for Apple to exceed market expectations on both iPhone sales and gross margins.




Cowen and Company



Unlike his peers, analyst Timothy Arcuri did not up his price target for AAPL following earnings, but he was still encouraged by the company's report. His forecast calls for shares to reach $135.

Arcuri said the iPhone 6 product cycle still has "ample runway," and he remains bullish. His enthusiasm is not as strong, however, for the Apple Watch, which he believes will require the launch of a revised second-generation device to truly make a splash.

J.P. Morgan



Rod Hall also maintained his price target of $145, but noted to investors that he expects Apple to continue to outpace expectations for the rest of 2015. He sees that growth driven by the iPhone, the Apple Watch, and other new products.

"Apple Watch pre-order numbers, but based on its gross margin commentary we infer that the company is planning to invest heavily in FQ3 to ramp up production with a goal of supply meeting demand by June," Hall wrote.

Wells Fargo



Finally, longtime Apple bear Maynard Um continues to be unimpressed by the company. Though he admitted the March quarter was "strong," it still wasn't enough for him to revise his neutral "market perform" rating.

Um was disappointed by declining iPad sales, he believes revenue from Apple services should be higher, and he also said he's surprised that gross margins from the newly launched Apple Watch are below the corporate average. He also said the increase of $50 billion in share repurchases is below some investors' expectations.

Still, Um did adjust his valuation range for the company to between $125 and $135, up from a previous range of $120-$130.