Apple (AAPL) Stock: Next Stop, $275?


Tech giant Apple (NASDAQ:AAPL) reported fiscal third-quarter results with revenue and EPS ahead of Street estimates due to strong iPhone ASPs and record Services revenue up 31% YoY. iPhone unit sales remained steady during the June quarter and management highlighted strong results across all geographies including China.

On the back of this excellent performance, Monness’ top analyst Brian White reiterates a Buy rating on Apple shares, while increasing his 12-month price target to $275 from $235, which implies an upside of 37% from current levels.

White commented, “We believe Apple’s strong software capabilities, expanding services business and unique digital ecosystem at large will increasingly be appreciated by investors, driving Apple toward the $1 trillion market cap milestone. Moreover, Apple is heading into the seasonally strongest time of the year with a new iPhone cycle on the horizon. In the end, we continue to believe Apple remains one of the most underappreciated stocks in the world with a valuation that remains depressed (12.3x our CY:19 EPS estimate, ex-cash).”

The analyst is raising his 4Q:FY18 revenue forecast to $61.44 billion from $60.81 billion and increasing his EPS projection to $2.73 from $2.61. For FY:18, White is increasing his revenue estimate to $264.13 billion from $262.57 billion and raising his EPS projection to $11.73 from $11.43. For FY:19, the analyst is increasing his revenue forecast to $280.15 billion from $278.71 billion and raising his EPS estimate to $13.25 from $12.86.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Brian White has a yearly average return of 15.5% and a 65% success rate. White has a 18.5% average return when recommending AAPL, and is ranked #140 out of 4840 analysts.

Ultimately, Wall Street is just not sure yet about this tech giant, but the optimists still win out in the bigger picture. Out of 29 analysts polled in the last 3 months, 17 rate a Buy on AAPL, while 12 issue a Hold. The 12-month average price target notably stands at $206.85, marking a slight upside potential.

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