Apple Inc. (AAPL) Supply Chain Signals Upside, NVIDIA Corporation (NVDA) Jumps Into the Self-Driving Car World


Between a robust supply chain abroad for Apple Inc. (NASDAQ:AAPL) and an impressive new collaboration for NVIDIA Corporation (NASDAQ:NVDA) and Bosch, analysts across the Street are betting on these two tech giants. Goldman Sachs and Needham see a great deal of potential waiting in the wings for Apple and NVIDIA, outlining bullish forecasts for the stocks. Let’s dive in:

Apple Supply Chain Looks Strong in Taiwan and China

After glancing at supply chain sales statistics from Taiwan coupled with data assessing government shipments from China, Goldman Sachs analyst Simona Jankowski sees all the more reasons to be bullish on the tech giant ahead of iPhone shipments. Therefore, cheering the results as “positive” and spotting upside in the future to iPhone projections for the first quarter, the analyst reiterates a Buy rating on shares of AAPL with a $150 price target, which represents a just under 7% increase from where the stock is currently trading.

Jankowski notes, “The six suppliers we track reported average sales up 27% yoy and down 18% mom, above the 3-year average mom seasonality of down 34% (Exhibit 2). For the trailing 2 months (Jan + Feb), sales were up 16% yoy. We maintain our iPhone forecast of 52.8mn units (+3% yoy, -33% qoq) in the March quarter, which is above consensus at 52.1mn units. If the above-seasonal supply chain trends hold, it could imply upside to our March quarter estimates.”

Moreover, “Based on China’s Ministry of Industry and Information Technology’s (MIIT) monthly data release, for the first two months of 2017, smartphone shipments in China grew 12% yoy to 72.8mn. Importantly, Android smartphone shipments grew only 5% yoy to 58.3mn, while non-Android smartphone shipments grew 50% yoy to 14.5mn. This could point to a rebound in iPhone shipments in China, as iPhones comprise the majority of non-Android shipments; however, the data-set can be volatile,” Jankowski concludes.

According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, five-star analyst Simona Jankowski is ranked #394 out of 4,539 analysts. Jankowski has a 66% success rate and realizes 11.0% in her annual returns. When recommending AAPL, Jankowski yields 24.7% in average profits on the stock.

TipRanks analytics exhibit AAPL as a Buy. Out of 36 analysts polled by TipRanks in the last 3 months, 28 are bullish on Apple stock, 6 remain sidelined, and 2 are bearish on the stock. With a return potential of 5%, the stock’s consensus target price stands at $148.25.

NVIDIA Spins Wheels of Possibility with New Bosch Deal

On the heels of NVIDIA revealing yesterday a new partnership with world’s largest auto supplier Bosch, top analyst Rajvindra Gill at Needham chimes in on the chip giant with a bullish take for the future of what he deems “the self-driving revolution.” Thanks to the alliance, Bosch will be relying on NVIDIA’s automotive chips to create an autonomous system for mass market vehicles.

In reaction, the analyst reiterates a Buy rating on NVDA with a price target of $120, which represents a close to 16% increase from where the shares last closed.

Gill believes, “Combining deep learning with Bosch’s Driving Policy software, NVDA’s next-generation Drive PX system, using Xavier, will leverage its on-board deep learning software and driving models, trained in data centers, to provide Level 4+ autonomous driving. (Drive PX systems can fuse camera, radar, Lidar, ultrasonic, and HD-Mapping data.) Xavier will have the computing power needed for full autonomy, allow for cloud connectivity – for mapping data and software updates, and will be the world’s first single-chip processor providing sensory fusion necessary for level 4 systems.”

“We believe the high valuation on the deal validates our belief that the ADAS and fully autonomous vehicle market are at the cutting edge of AI technological development and market disruption,” contends Gill.

Looking down the road, the analyst foresees the ADAS automotive semiconductor market has the potential for CAGR growth circling 34% to $8.5 billion in the upcoming 5 years ahead.

Rajvindra Gill has a very good TipRanks score with a 66% success rate and a high ranking of #43 out of 4,545 analysts. Gill garners 17.6% in his yearly returns. When recommending NVDA, Gill collects 10.4% in average profits on the stock.

TipRanks analytics demonstrate NVIDIA as a Buy. Based on 27 analysts polled by TipRanks in the last 3 months, 14 rate a Buy on NVIDIA stock, 9 maintain a Hold, while 4 issue a Sell. The 12-month average price target stands at $110.45, marking a nearly 7% upside from where the stock is currently trading.

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