Apple Inc AAPL is experiencing an iPhone 12 “supercycle” and seeing “major tailwinds,” not seen since 2014, which could propel the tech giant’s stock to $200 levels, according to Wedbush Securities.
The Apple Analyst Wedbush analyst Daniel Ives maintained Outperform rating on the Tim Cook-led company and increased their 12-month price target on the stock to $160 from $150. Ives increased the bull case price target from a previous $175 to $200.
The Apple Thesis: The Wedbush analyst said their recent checks lead them to be bullish on iPhone 12 demand in China and the United States.
In the U.S., the 6.1 inch model of the iPhone 12 was “the star of the show” going into the holidays, as per Ives. The Pro Max model is attracting “very strong demand” out of the gates in the United States heading into FY21.
The pent up demand in China is driving sales for the latest iPhone 12 5G, which Ives characterized as “the strongest product cycle for Cook & Co. thus far since iPhone 6 in 2014.”
The Wedbush analyst continues to believe that the supply chain is anticipating 80 million iPhone 12’s for the initial launch period with a potential stretch goal to the mid-1980s.
Ives estimates there are 350 million out of 950 million iPhones globally that are in the window of an upgrade opportunity, which can translate into an “unprecedented upgrade cycle” for the Cupertino, California-based tech giant with the holiday season on the horizon.
The expert believes that while street has projected 215 million iPhone units for FY 21, Apple could sell more than 240 million units, which would beat the previous record of 231 million iPhone 6 units sold in 2015.
China would be the key to Apple’s success and the analyst estimates the country would contribute 20% to the total iPhone upgrades.
Apple Price Action: Apple shares closed nearly 0.5% higher at $124.38 on Tuesday.
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