Analysts have also raised the price target by \(17 to \)225 per share, indicating an increase in iPhone and Services projections.
Supporting a more optimistic outlook on Apple stock are various factors, such as a robust multi-year iPhone upgrade cycle, accelerated growth in Services, solid capital returns, and other positive indicators. Additionally, analysts are of the opinion that the recent negative EPS estimate revisions have been left in the past for Apple.
This upward revision coincides with a shift in investor attention towards the upcoming launch of Vision Pro next month, along with the anticipated introduction of an AI-powered iPhone, slated for either late 2024 or 2025.
The heightened estimates for iPhone and Services have resulted in EPS projections surpassing the market expectations by 7% and 4% for fiscal years 2025 and 2026, respectively.
Regarding Services, there is notable progress observed across various segments, including advertising, health & fitness, among others, within a broader user base, as highlighted by analysts in a recent communication.
Specifically, BofA anticipates that Vision Pro will eventually outperform iPad revenues as spatial computing gains traction, offering unique applications that could drive additional growth in services.
Furthermore, insights from the broker’s supply chain assessments reveal an uptick in iPhone manufacturing activities in December, which may be counterbalanced by potentially reduced figures in March.
Apple’s stock performance year-to-date has seen a decline of 5.1% as of the close of trading on Wednesday.
