6 Reasons Apple Has 50% To 85% Upside

Shares of Apple Inc. AAPL are spiking on Friday morning, near $100 per share after Piper Jaffray analyst Gene Munster reiterated that the stock makes a good buy ahead of earnings and said most of the bad news is "priced in."

Here were Munster's main points:

1. Apple's current valuation shows most "bad news" is priced into the stock, given the stock's similar behavior in 2013.
2. Stock multiples typically expand before new iPhone model launches. The iPhone 7 is expected to be launched in September.
3. Apple could have 50 percent upside from current levels and Munster's price target implies 85 percent upside.
4. Buybacks should drive single-digit EPS growth "regardless of revenue." If revenue stays flat, EPS can grow 3 percent per year if Apple keeps repurchasing $20 billion to $30 billion a year.
5. Apple should post December quarter margins toward the "high-end" of its guidance, near 40 percent (despite other analysts' bearishness in this area).
6. Apple's upside exists despite oil macro risks, China issues and EU "instability."

Apple shares are near $99.97 on Friday as of this writing.