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.
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