Morgan Stanley has raised its Apple stock price target to $315, with the stock still a core overweight pick for the analysts heading into 2026.

As 2025 comes to an end, analysts take stock of their stock picks from the year and what to expect for the year ahead. For Morgan Stanley, that includes an increase in confidence in Apple.

In a note to investors seen by AppleInsider on Wednesday, Morgan Stanley is increasing its price target for Apple from $305 to $315. This is an increase of $10 from the last time it changed the target on October 31.

In the note, Morgan Stanley says it sees bit opportunities for Apple to grow in 2026.

Memory and AI

When it comes to cloud services and expenditure, Apple's demand is expected to remain static despite the prospect of rising prices for infrastructure. Enormous RAM cost increases could cause a problem for some companies regarding the bill of materials, which naturally includes Apple.

With pricing pressure on memory, Morgan Stanley doubts that can be offset by Apple Intelligence. The infrastructure buildout to handle AI in general probably cannot outpace the cost of memory rising sharply.

For the price target itself, the raise reflects an unchanged multiple of 32 times for Morgan Stanley's 2027 financial year expectations. For that year, it anticipates an earnings per share of $9.83, up from $9.55.

The increase is due to an anticipated lower gross margin because of higher memory costs, as well as a 5% higher anticipated revenue. This revenue increase will apparently be from price hikes driven by commodity cost inflation, as well as a marginal increase in iPhone shipment forecasts.

The iPhone 17 cycie in particular is apparently benefiting from a longer 5-year replacement cycle. Core feature upgrades and better carrier subsidies and trade-in offers have also helped increase sales.

Going into 2027, Apple is expected to exit the 2026 financial year with about 550 million iPhones on the market that cannot upgrade to Apple Intelligence. With the new Siri and third-party LLM support expectations, this could help push upgrades more into the year.

That said, Morgan Stanley doesn't assume Apple will make any real artificial intelligence monetization plays yet. The movements are positive, but there doesn't seem to be any immediate product or Services upside.

Supply chain and Services

There's also an effectively unchanged operational expenditure trajectory for Apple, despite historical seasonality, thanks to its AI investments.

Better supply chain leverage than other companies also helps Apple considerably, as well as lower China tariff expectations, and anticipated price increases for iPhones.

Services will still be a growth center, Morgan Stanley forecasts, with sustained double-digit revenue growth for the segment thanks to price increases and App Store improvements.

Ultimately, Morgan Stanley gives Apple a continued "Overweight" rating, a 14% risk-adjusted risk-reward, and a 1.6 bull-to-bear skew.