Analysts reset Apple’s safe price target on AI, buybacks

Analyst: Apple has ‘a key to the castle’

And in a month where there seem to be many doubters, Wedbush analyst Dan Ives is a believer.

Ives, who has an Outperform rating and a $275 price target on Apple shares, said in a July 8 note that the company wouldn’t be off track to reach a $4 trillion market capitalization with an AI iPhone 16 upgrade cycle.

Homogeneous: Analyst opines that Apple keeps stable price target on iPhone sales

“We believe the Street is now slowly starting to recognize that with Apple Intelligence on the doorstep, Cupertino consumers will be the gatekeepers of the AI ​​revolution,” he noted in an analysis statement.

Ives mentioned that builders and alternative era stalwarts will likely want to integrate their AI fashions and eras into Apple wisdom going forward, “because Apple and its golden iOS ecosystem has 2.2 billion iOS devices and 1.5 billion iPhones worldwide.” It’s the only key to the castle.” ,

Ives noted, “We expect developers to create hundreds of generic AI-powered apps over the next 6 to 12 months that will be a critical component to Apple’s success,” as its technology stack forms the core building blocks for consumer apps. “The AI ​​tidal wave we’re seeing starts with the iPhone 16 in mid-September.”

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Apple’s iPhone sales in China have declined significantly this year, although Ives said, “June will be the last negative growth quarter for China and growth will begin to turn around in the September quarter.”

He noted, “China remains a key focus of growth for Apple, and now this key region is set to see growth once again, starting with the iPhone 16.”

Speaking of the iPhone 16, according to Bloomberg, Apple is reportedly planning to ship at least 90 million iPhone 16s in the final stretch of this year, which is 10% more than the previous launch. The corporate relies on synthetic perception services and products to force the next tough 2023 call.

Apple has advised providers and partners that it is focusing on about a 10% increase in shipments of unused iPhones, compared with their predecessors shipping about 81 million iPhone 15s in the second half of 2023, Bloomberg reported on the subject. But brought forward a general expert and told.

The document says the company is confident that adding some Apple Wisdom features to the iPhone 16 will help drive demand when it goes on sale late this year.

Analyst says AI could be ‘needle mover for upgrades’

Investors were inspired when Apple announced a $110 billion secured buyback in May. This was the largest buyback authorization in company history, topping the previous $100 billion buyback in 2018.

“For the last few years, we were doing $90 billion, now we’re doing $110 billion,” Chief Financial Officer Luca Maestri noted during the earnings call. “So, let’s get there first. It’s going to take some time then and there.” When we’re there, we’ll reevaluate and see what the optimal capital structure is for the company at that time.”

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“Obviously, there’s a lot of things we’ll have to look at when we get there,” he said.

Needham analyst Laura Martin cited the buyback when she raised the company’s price target on Apple to $260 from $220 and saved the shares a buy ranking.

The decision to buy back the $110 billion secured comes at a pace when other giant tech names are spending $50 billion to $100 billion on Gen-AI infrastructure, the analyst said.

On the other hand, he additionally warned that, over a three-year time frame, Apple’s single-digit earnings expansion “feels increasingly at risk.”

Apple, which is scheduled to report third-quarter revenue on August 1, will have to create a promotional industry. Martin said advertising margins are 70% – 80% in most cases, which could force an increase in the company’s margins without raising equipment prices.

Meanwhile, Piper Sandler analyst Matt Farrell mentioned the iPhone and China in an analysis note. He raised the company’s price target on Apple from $190 to $225 and maintained a neutral ranking on the shares following a change in analysts.

Farrell noted that since the beginning of April, Apple stock had risen more than 30% due to excitement about Apple Wisdom and a potential surge in iPhone shipments to China.

He further said that excitement is necessary, because synthetic perception “can be like a needle for an upgrade.”

Additionally, an increase in iPhone gross sales in China could create a tailwind in the second half, the analyst said.

On the other hand, given the wavering valuations and the growing possibility of client spending in the opposite direction, Farrell noted that he feels like “the stock already contains a lot of good news.”

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