Pacific Crest’s Andy Hargreaves recommend owning shares of Apple Inc. AAPL, citing likely growth in the iPhone 7 cycle and an attractive valuation. The price target is at $127.
Apple is scheduled to host an event on March 21, at which it is expected to launch the new iPhone SE, which should replace the iPhone 5s at the low-end of its product lineup. The company is also expected to launch its 9.7” iPad Pro, new Apple Watch bands, and a number of software updates.
“We do not expect the new hardware or software to materially alter our outlook for earnings or our view of the stock,” analyst Andy Hargreaves wrote.
iPhone SE Unlikely To Have A Significant Impact On Estimates
Low volumes are anticipated for the iPhone SE, with minimal impact on estimates. The estimated price point is between $450 and $500. Being at a similar price point to the iPhone 5s, sales volumes of the iPhone SE is likely to be similar, with a similar overall margin profile, Hargreaves said.
Other Expectations
Apple needs a broader wearables lineup to push the Apple Watch, rather than just new bands, the analyst mentioned. He expects the new iPads to sell “a lot like the old iPads.”
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