JP Morgan ups Apple price target to $180, citing 5G iPhone SE expectations

Credit: Andrew O'Hara, AppleInsider

Investment bank JP Morgan has raised its Apple price target to $180 on expectations that the "iPhone 13" and a 5G iPhone SE could be catalysts that drive another record year for the Cupertino company.

In a note to investors seen by AppleInsider, JP Morgan lead analyst Samik Chatterjee says that he sees "substantial upside" relative to consensus expectations for the 2022 fiscal year. That's because of the aforementioned iPhone models, as well as low investor expectations for iPhone and total revenue.

Chatterjee has increased his iPhone volume estimates for 2022 to 246 million units, which implies another record year of Apple handset shipments following 2021.

The analyst says these expectations are based on moderations in the "iPhone 13" upgrade rate relative to Apple's iPhone 12 and iPhone 12 Pro lineups.

He adds that the numbers are offset by the higher volumes for devices with lower average selling prices (ASP). However, the launch of a 5G-equipped iPhone SE model could provide upside through Apple's large installed base.

Despite the slight moderation in the 2022 iPhone upgrade rate, Chatterjee believes that the rate will still contribute to a similar level of volume because of a larger installed base. His expectations still use an upgrade rate that remains above the 4G smartphone era.

The analyst has raised his revenue and earnings-per-share (EPS) expectations for 2022, which now sit 2% and 7% above consensus.

Additionally, Chatterjee has raised his 12-month Apple price target to $180, up from $175. The new target is based on a price-to-earnings multiple of about 30x on JP Morgan's 2022 Apple earnings estimate of $6.

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5 Comments

marktime

said about 2 years ago

Headline is wrong, should be $180 not $170

geekmee

said about 2 years ago

Jeesh! SMH!!… 5G? Really??
Nothing to do with Apple consistently adding more value over time, to make the whole more valuable than the parts. Absolute genius.

ArchStanton

said about 2 years ago

Analysts expectations are currently at average 1.23 EPS for Q4. That'd put Apple at about 5.62 EPS trailing twelve months going into the holiday season.
To reach the 6.00 EPS and 180 share price(using the 30 PE multiple), Q1 holiday season for Apple will need an EPS performance around 2$. That would be the biggest ever by 20%. It means Apple needs these new products rolled out successfully by October. (not withstanding more buyback activity which removes shares and makes less net profit a higher EPS).

nzhong168

said about 2 years ago

Maybe his estimate of Q4 higher than 1.23

ArchStanton

said about 2 years ago

nzhong168 said:

Maybe his estimate of Q4 higher than 1.23

Very possible. Apple has been crushing expectations. 1.33 I think is the highest estimate. Maybe Apple over performs that highest estimate and earns 1.40 — which would be a huge over perform.

that would knock the holiday quarter down to about a needed 1.82 for the math of his prediction to be right. But that will require this holiday quarter to beat last holiday quarter by 10%. Much more doable but still will have to be the ‘best Christmas eva’ in Apple sales to hit that mark.

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