JPMorgan said: “We continue to recommend Apple stock to long-term investors, and we raise Apple’s target price mainly due to re-rating of stocks due to service transformation. However, we should be wary of investment until Apple releases its earnings report later this week. High expectations. ”
According to foreign media reports, before the release of Apple’s key holiday quarterly earnings report, JP Morgan Chase raised its Apple stock target price to $ 300, but warned that investors now expect Apple to be too high.
In a report issued to investors by JP Morgan Chase equity analyst Samik Chatterjee, he predicted that Apple’s holiday season would be very strong and that its revenue should be close to its expected revenue range. High-end, mainly because Apple Watch and AirPods performed better than expected. Apple Corp. predicts that its holiday season revenue will be between $ 85.5 billion and $ 89.5 billion, while Chatterjee expects this quarter’s revenue to reach $ 88.7 billion.
Specifically, Chatterjee predicts that iPhone revenue will account for $ 49.7 billion, iPad and Mac will each generate $ 7.3 billion in revenue, and service revenue will be $ 12.9 billion. Wearables plus Smart home and accessories revenue will be $ 11.6 billion. The overall gross profit margin is expected to be 38%, of which the service gross profit margin will reach 64.5%.
Chatterjee raised Apple’s stock price target to $ 300 from the $ 296 set on December 20, due to “very strong wearable device growth during the holiday season.” Chatterjee also said that he expects “Apple’s transition to the services business will continue to make progress”, which is expected to grow by 18% over the same period last year.
Despite this, Chatterjee advised investors to proceed with caution and to some extent reconcile their high expectations.
Chatterjee wrote: “We continue to recommend Apple’s stock to long-term investors, and our increase in Apple’s target price is mainly due to re-rating of stocks due to service transformation. However, before Apple’s earnings report later this week, we should Beware of excessive expectations from investors. ”
Chatterjee estimates that Apple’s total revenue for the second fiscal quarter of this year will be 63.7 billion US dollars, with a gross profit margin of 37.9%. In the second fiscal quarter of fiscal 2019, Apple’s revenue was $ 58 billion.
In pre-open trading Monday, Apple shares fell 2.1% to $ 311.50.
Other analysts are more optimistic about Apple’s future stock price trend. Canadian investment bank Cannacord also predicted in a January 15 report that, based on the strong demand for iPhone 11, the sales momentum of “iPhone 12” will also remain strong. Cannacord expects revenue for Apple Services to continue to grow next year and raises its target price from $ 275 to $ 355.
Investment bank Rosenblatt analyst Jun Zhang was less optimistic about the stock. Recently, Zhang raised the target price of Apple stock from $ 150 to $ 250, but he does not think that Apple’s services business will see strong growth, nor does he think that “iPhone SE 2” or 5G iPhone 12 will bring any dramatic The change.