Apple (AAPL) Stock Coverage Initiated at Longbow Research
NEW YORK (TheStreet) -- Apple (AAPL) - Get Report stock coverage was initiated this morning at Longbow Research with a "buy" rating and a $125 price target.
"We see Apple as undervalued against stabilizing iPhone demand, a growing subscriber base that aids in Apple's ability to monetize its ecosystem, optionality provided by the notable jump in R&D spend, and sizeable free cash generation," Longbow wrote in an analyst note.
Apple shares are higher by 0.35% to $95.32 in mid-afternoon trading.
The firm forecasts the Cupertino, CA-based technology company to increase its iPhone installed base to 710 million users for FY16 (+110 million year-over-year), which would provide a tailwind for the expected September release of the iPhone 7.
"Apple's current installed base should create a floor in iPhone shipments, while future iPhone models, growth in India (each 100bp of share in India adds $1B in sales), and the tailwind from a replacement cycle with a larger installed base should drive iPhone growth in coming years," the firm wrote.
Longbow sees a 31.5% upside in the stock.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate APPLE INC as a Buy with a ratings score of B. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, notable return on equity and expanding profit margins. We feel its strengths outweigh the fact that the company shows weak operating cash flow.
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