Apple Inc’s (AAPL) iPhone 6s Has Enough Appeal to Increase Sales 4% Year-over-Year: Piper Jaffray

Apple Inc (NASDAQ:AAPL) held its highly anticipated annual press event yesterday and debuted pretty much everything Wall Street had expected, including the new iPhone 6s and iPhone 6s plus, a 12.9-inch iPad Pro, an updated iPad Mini, and an updated Apple TV.

iPhone 6s and iPhone 6s Plus

The new iPhone 6s and iPhone 6s Plus look pretty much the same as the current models, but according to CEO Tim Cook, Apple has “changed everything.” The new phones are now available in rose gold and have a new version of force touch technology called “3-D Touch” that can recognize how hard you touch the screen. For example, touching the screen for a long time allows for shortcuts around the iPhone, which will make for quicker interactions within apps without having to open them. Additionally, the new iPhones are equipped with a new 12 megapixel camera on the back and a 5 megapixel camera on the front which will allow for clearer pictures and videos. The new iPhones will cost the same as the iPhone 6 and iPhone 6 Plus and will be available on September 25 in 12 countries.

Piper Jaffray analyst Gene Munster believes “the iPhone 6S should have enough appeal, along with the lower price for existing iPhone 6 and Plus, to allow Apple to continue to gain share at the high end of the phone market.” Reiterating a Buy rating on Apple with a $172 price target yesterday, he expects “4% [year-over-year] iPhone unit growth vs. the Street at flat in 2016.”

iPad Pro and iPad Mini

Apple introduced the new 12.9-inch iPad Pro meant for those with creative pursuits who require a large-screened portable device. Cook called this product the “biggest news in iPad, since iPad.” Features of the new iPad Pro include a 10-hour battery life, four separate surround sound speakers, improved retina display, and a smart keyboard. The new iPad Pro will also feature a pressure-sensitive stylus that can be used along with your fingers. The new iPad will be available in November, just in time for the holiday season, starting at $799 for the 32 GB model.

The iPad Mini was updated as well and now has “the power and performance of the iPad Air 2.”

Although Munster may have been impressed by the iPad Pro innovations, he does not believe the additions will change his lackluster iPad sales estimates. The analyst noted, “the new iPad Pro is incremental but does not change our belief that iPad units will be down 4% in 2016.”

Apple TV

Apple unveiled the next generation Apple TV with a new operating system called tvOS, which will make it easier for third party developers to create apps for the device. The new Apple TC also features a new Siri powered remote, new applications, and enhanced capabilities for gaming. Consumers will be also able to use the remote as a video game controller.

Again, Munster was unconvinced that the new additions would have a meaningful impact on sales, noting, “Updates to Apple TV should add a little less than 1% to Street estimates in 2016 (not in our model).”

Munster has rated Apple 149 times total since 2009, earning a 66% success rate recommending the tech giant and a +26.1% average return per AAPL recommendation when measured over a one-year horizon and no benchmark. Overall, he has a 59% success rate recommending stocks and a +20.6% average return per recommendation.

Out of 36 analysts polled by TipRanks who have rated Apple within the past three months, 27 are bullish, 8 are neutral, and 1 is bearish. The average 12-month price target on the company is $145.03, marking a 31.67% potential upside from where the stock last closed.

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