Why Wall Street Is Warming Up To Apple

Apple has climbed after Black Friday weekend, as Wall Street has turned even more bullish. Here are some of the key reasons cited by analysts for their optimism towards the stock in the holiday season.
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In the first couple of days following Black Friday, Apple stock climbed about 7%. The market value gain came as Wall Street turned even more bullish on the Cupertino company.

Sell-side upgrade on the stock

It all started on November 30, a day when the broad market did not fare all that well. Loop Capital’s analyst Ananda Baruah saw enough reasons to upgrade Apple from hold to buy. According to him:

The analyst did not seem to forget any major area of the business to justify the upgrade: Mac, iPad, AirPod, Watch and Services. Even optimism towards the speculated iPhone 13 supported bullishness. Ananda’s earnings-per-share estimate is now about 10% above consensus.

Not to be outdone, old-time Apple bull Katy Huberty, from Morgan Stanley, also weighed in. According to her, Apple should be worth north of $190 per share, which implies a solid upside opportunity of about 50%.

Katy’s price target bump was justified by the results of a survey suggesting strong demand for the iPhone 12. According to her:

A tamer bear

Even Credit Suisse’s Matthew Cabral, who has a neutral rating on Apple and recently warned that holiday demand for the iPhone seems to have eased, sounded a bit more optimistic after Cyber Monday. According to him:

What to make of it

Apple’s share price decline of as much as 20%, after the stock reached an all-time high in early September, raised some eyebrows. Shares seemed to have rallied too far and too fast earlier in the year, especially after investors’ “irrational exuberance” over the August 4-to-1 stock split.

Slowly, experts seem to be getting a bit more comfortable with the idea of going long Apple. A mere return to September peak levels would mean nearly 10% upside opportunity – but many analysts seem to think that the ceiling for 2021 may be far above current year levels.

Read more from the Apple Maven:

Apple Stock: Cyber Monday and Thoughts From Jim Cramer

Apple Stock In November: Wobbly Recovery Continues

What To Expect of Apple Stock Through The End of 2020

(Disclaimers: the author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting The Apple Maven)