Neil Hughes
Following this week's stock split, RBC Capital Markets sees shares of Apple reaching near-record highs in the second half of 2014, based on the strength of the expected "iPhone 6," as well as hotly anticipated new product categories from the company.
"iPhone 6" and "iPhone 6c" concepts by Martin Hajek.
Analyst Amit Daryanani issued a note to investors on Thursday, a copy of which was provided to AppleInsider, revealing his new price target of $100 per share of AAPL. That's up from his previous prediction of $96 per share, which itself was $675 prior to the company's 7-for-1 split that took effect on Monday.
RBC's new price target would put Apple at a near-all-time-high, as the company's previous record is now $100.30 in post-split trading.
Daryanani said his new target of $100 reflects increased confidence in the upcoming second half of Apple's calendar 2014. In particular, he believes that the company's expected "iPhone 6" could prove to be even more profitable with a higher-end model.
Given rumors of two screen sizes of 4.7 inches and 5.5 inches, Daryanani believes that Apple could sell a jumbo-sized iPhone at a starting price of $299 on contract. He also believes that improved iPads will arrive this fall, as Apple has done in recent years, helping to boost hardware sales.
Daryanani is also excited about new product categories, which Apple has pledged to enter into in 2014. In particular, the analyst believes that Apple will release its widely rumored so-called "iWatch" later this year.
He sees an "iWatch" making Apple users more integrated into the company's ecosystem by acting as a health monitoring system, and also increasing communication with other Apple devices.
As for a "wild card" prediction, Daryanani said he doesn't expect Apple to release a full-fledged television set this year, but he believes recent reports indicating that Apple is moving its ad-creation in-house hint that the company could be looking to build its own HDTV in the long term.
After the split took effect on Monday, shares of AAPL opened at $92.69. Overall, they're up slightly for the week through Wednesday trading, and were up again Thursday in pre-market NASDAQ trading to about $94.
Christine McKee
Andrew Orr
Charles Martin
Marko Zivkovic
Wesley Hilliard
16 Comments
5% increase from here? Too conservative BTW, hope TIm is buying the stock hand over fist before goes up anymore
[quote name="sog35" url="/t/180623/rbc-ups-apple-price-target-to-100-sees-iphone-6-new-product-categories-driving-growth#post_2549518"]LOL. These 5% estimates are ridiculous. If you are giving it a BUY rating and only expecting it to go up 5% in the next 12 months is stupidity. If you think its only going up 5% in 12 months it should have a hold rating. If you give it a buy rating your target needs to be at least 10%-15% [/quote] Not necessarily. It depends on how well you think the market might do.
The analyst community is showing its ignorance when analysts suggest that a pre-spilt price of $705 would take Apple back to its previous high. At the time Apple hit $705 in Sept of 2012, there were about 945 million shares outstanding. That means, at $705 * 945 million shares, the market valued Apple at $660 billion, its highest valuation in its history. To get back to that same valuation, with the current share count at about 861 million, Apple shares would need to reach $770, or $110 post-split. So $110 is the new $705. How are analysts missing this? If Apple had instead done a reverse split, say 1:2, to take the shares over $1000, I suppose these same analysts would have written 'Apple Overnight Reaches New Highs!'
Going to be fun watching the price whoosh right by this target. There's a lot driven by fundamentals but clearly a lot of valuation is due to sentiment and speculation. How else to arrive at 563 P/E ratio for Amazon with no profits and 16 for Apple with gobs of it?
Apple's split and dividends and buybacks are, on the one hand, simple machinations to goose the stock price but on the other hand makes sense from company value standpoint. It's a good use of cash. That it will influence the price of the stock positively is welcome for anyone who cares about that but not at the detriment to the value of the company or its abilities to keep churning out amazing products.
-An Apple customer and shareholder
*And indeed my comments are a lot of sentiment and speculation too!
The analyst community is showing its ignorance when analysts suggest that a pre-spilt price of $705 would take Apple back to its previous high. At the time Apple hit $705 in Sept of 2012, there were about 945 million shares outstanding. That means, at $705 * 945 million shares, the market valued Apple at $660 billion, its highest valuation in its history. To get back to that same valuation, with the current share count at about 861 million, Apple shares would need to reach $770, or $110 post-split. So $110 is the new $705. How are analysts missing this? If Apple had instead done a reverse split, say 1:2, to take the shares over $1000, I suppose these same analysts would have written 'Apple Overnight Reaches New Highs!'
That makes sense. The analysts aren't doing their jobs properly. I guess my new reset number is $110. I think that's going to take a little longer for Apple to reach. I think only super-high iPhone sales and a wearable device near the end of the year are going to get it that high.