Gene Munster Delves into Apple Inc. (AAPL) and the Big AR Intrigue


After conducting a survey half of a year before the Apple Inc. (NASDAQ:AAPL) iPhone X is launched into the tech-verse, Gene Munster – divvying insights from his new research-driven, venture capital firm Loup Ventures – sees not only a rising desire for users to upgrade, but high interest in the air for augmented reality (AR). Especially with regards to millennials, more and more it appears that AR is the key to unlocking untapped profitability of the future.

Munster notes, “As we get closer to launch, the rumor mill can positively or negatively impact excitement about buying. If the rumors live up to the early hype, interest will likely increase; if they don’t, interest may decrease. The higher intent to purchase the iPhone X likely also reflects the increasing popularity of the iPhone Upgrade Program. While it’s still early, interest in upgrading to the iPhone X appears to be meaningfully higher than upgrade interest was for the iPhone 7.”

In last week’s survey, the analyst gauged the interest level of 502 people in the U.S. to see who was most likely to purchase the iPhone X, widely rumored to hit this fall. When considering the total number of consumers who intend to buy the iPhone X, 26% have expressed intrigue in AR features, juxtaposed against 16% with no intent to splurge on the new iPhone. For the analyst, “This could be driven by the simple correlation between early adopters of iPhones and early adopters of new technology, like AR.”

“Not surprisingly, the 18-29 year old cohort has the highest interest in AR at 34%. Among older age groups, interest in AR declines. This points to the willingness of millennials to be early adopters. We believe younger users are the key to widespread AR adoption over the next decade,” continues Munster, believing millennials could give the tech giant even more incentive to explore the depths of AR.

Additionally, with regards to gender, 29% of males are drawn to the high-tech AR elements of the phone, which marks a bit of a male-preference compared to the 23% of females interested in AR features.

Munster anticipates the fresh AR-related features on the next-level iPhone will be demand-drivers, quite possibly impacting AR “in a very big way.” Clearly, between the enticing new upgrade and the tech giant’s thrilling foray into AR, the analyst sees short-term and long-term advantages to owning Apple shares.

TipRanks analytics demonstrate AAPL as a Buy. Based on 37 analysts polled by TipRanks in the last 3 months, 28 rate a Buy on Apple stock, 7 maintain a Hold, while 2 issue a Sell on the stock. The 12-month average price target stands at $146.14, marking a nearly 5% upside from where the stock is currently trading.

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