JP Morgan Raises AAPL Price Target to $ 210 From Potential iPhone SE 5G Launch
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Investment bank JP Morgan raised Apple’s target price to $ 210, citing strong demand and expected earnings in early 2022, along with the prospect of a 5G iPhone SE.
In a note to investors seen by Appleinsider, JP Morgan analyst Samik Chatterjee believes that Apple stocks have “managed to reverse the underperformance” of the first half of 2021, due to improving demand expectations for the iPhone 13.
While everything is going well so far, it is believed that “most of the realization of the higher revenue and profit” has yet to happen, and will likely do so in early 2022. Further upgrades to consensus iPhone shipments are expected, in part due to rumors of a new iPhone SE.
It is expected that an iPhone SE with 5G connectivity will launch in early 2022. The smartphone is believed to have the potential to drive upgrades from an estimated installation base of older iPhones of around 300 million. units, as well as attracting switches from a pool of some 1.4 billion low to mid-range Android device owners.
The iPhone SE with 5G will become “the most affordable 5G iPhone in the lineup” and may lead to a more frequent upgrade schedule for the model. After the 2022 release, the iPhone SE may benefit from a “frequent annual upgrade in the future.”
âWe believe that the focus on demand and supply for the iPhone 13 is leading investors to underestimate the suitability of the iPhone SE 5G for the FY22 product cycle,â JPM says, while increasing its forecast of units for the year 2022 to 250 million units, about 10 million more than the figures for the year 2021.
In turn, JP Morgan raised its December 22 price target for Apple to $ 210, from the $ 180 it set in August. In addition to the iPhone’s revenue potential, the favorable outlook also rests on the rise of a “business-to-services transformation”, as well as the growth of the installed base, “technology leadership” and the potential for Apple to deploy capital where it’s needed.
Although it is also considered “overweight” by the bank, Apple stock is also considered a “first choice until 2022”.
The price target has been raised to $ 210 based on an increase in the earnings / earnings ratio to approximately 30 times and an estimated earnings for the calendar year of $ 6.90. The company notes that the multiple has been increased from the previous 26x and that AAPL has traded closer to 30x “following the revaluation due to growth in services as well as expectations of better execution on the market. product cycle “.