Apple (NASDAQ:AAPL) recently reclaimed its $3 trillion market cap. But why stop there, right?
In fact, by this time next year, Wedbush’s Dan Ives, a 5-star analyst rated in the top 2% of the Street’s stock pros, expects Apple to reach another mind-bending milestone: “We believe Apple will be the first $4 trillion market cap by the end of 2024 given the pace of growth and monetization we estimate for Cupertino over the next year.”
Ives’ confidence is based on the strength seen following the release of the iPhone 15 line up. Despite plenty of bear noise, on the back of “strong upgrade activity” within the US and China markets, Ives anticipates a strong holiday season in the weeks ahead, the result of which should be iPhone 15 growth that outpaces Street expectations for the December quarter. “We have not seen any negative revisions around iPhone units coming out of our recent Asian supply chain checks into holiday season/early 2024 which speaks to what we believe is a very consistent consumer demand environment around iPhone 15 so far and is good news for Cook & Co,” Ives went on to say.
Going by industry checks, Ives expects iPhone sales between 220 million to 230 million units in FY24 and should the current pace of upgrade activity continue into the March/June quarters, there could be upside to that estimate, with Ives believing the Street “continues to underestimate the underlying upgrade opportunity in China during the December quarter and FY24.”
This cycle is also defined by rising ASPs (average selling price), which are now heading towards $925, up from the past few years’ $825/$850 ASP.
Factor in Services revenue “back to steady double-digit growth,” and Ives makes the case any talk of the “growth demise story” is misplaced. “With roughly 240 million iPhones in the window of an upgrade opportunity globally now at play for iPhone 15 and Services re-accelerating into FY24 we view this as the golden opportunity to own Apple for the next year,” he summed up.
The upshot of such a positive take is a revised price target. Ives has raised his target for AAPL from $240 to a Street-high $250, suggesting shares will climb ~28% higher in the year ahead. No need to add, Ives’ rating stays at Outperform (i.e., Buy). (To watch Ives’ track record, click here)
Elsewhere on the Street, the stock receives an additional 24 Buys and 8 Holds, all for a Strong Buy consensus rating. However, the $203.70 average target implies shares will remain rangebound for the foreseeable future. (See Apple stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
