NEW YORK (TheStreet) -- The shares of Apple (AAPL) - Get Apple Inc. Report are rallying as the market rises and after Wells Fargo upgraded the stock to Outperform, saying that the recent downturn in the stock was overdone.
WHAT'S NEW: The recent decline in Apple's stock before today's open was overdone, Wells Fargo analyst Maynard Um wrote in a note to investors this morning. The firm noted that Apple CEO Tim Cook said yesterday that the growth of iPhone activation in China had accelerated in the last few weeks. That statement decreases the risk of the company's September quarter results, according to Um, who believes the increased visibility will boost the stock heading into earnings. Meanwhile, Apple's third party manufacturing and component commitments may indicate that the company's revenue will surpass its $49B-$51B guidance, Um stated. The analyst predicted that the results for Apple's December quarter will miss expectations, but adds that the stock "already reflected this challenge."
WHAT'S NOTABLE: Defending Apple's stock on its weakness in a note to investors yesterday was Cantor Fitzgerald. According to Cantor analyst Brian White, the stock had reached "severely depressed levels" on fears about the company's China business. However, the fears about Apple's outlook in China were "way overblown," given the expansion of 4G networks in that country, the rise of its middle class and Apple's expansion in the country. Moreover, Apple has multiple additional catalysts, including opportunities in India, weakened competitors, and the growth of Apple Watch, White contended. He kept a $195 price target on the shares and reiterated a Buy rating.
PRICE ACTION: In early trading, Apple advanced 4.5% to $107.82.
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