Apple Inc. (AAPL) - Get Apple Inc. (AAPL) Report shares traded higher Monday after a pair of price target increases from Wall Street analysts as the world's most valuable tech company races towards a $2 trillion market valuation.
Wedbush Securities' Dan Ives, a longtime Apple bull, boosted his price target on the tech giant to $515 per share, a $35 improvement from his prior estimate and the highest on Wall Street, arguing that the market is underestimating the buildup in consumer demand for its next product cycle, which he anticipates will consist entirely of 5G compatible devices.
Deutsche Bank analyst Jeriel Ong also raised its price target by $40, to $480 per share, calling it "one of the highest quality stocks in our coverage."
"While the soft macro and COVID backdrop are weighing on near-term consumer demand trends, Apple has a "once in a decade" opportunity over the next 12 to 18 months as we estimate roughly 350 million of Cupertino's 950 million iPhones worldwide are in the window of an upgrade opportunity," Ives wrote. "Taking a step back we believe iPhone 12 represents the most significant product cycle for Cook & Co. since iPhone 6 in 2014 and will be another defining chapter in the Apple growth story looking ahead despite a softer consumer spending environment in our opinion."
Apple shares were marked 1.3% higher in early trading Monday to change hands at $450.93 each, a move that would extend the stock's year-to-date gain to around 54% and value the Cupertino, California-based tech group at around $1.933 trillion.
Apple shares would need to trade at $467.77 each -- a 5.25% gain from their Friday close -- to breach the $2 trillion valuation mark.
Last month, Apple topped the $400 mark for the first time after blowout third quarter earnings in the face of pandemic-triggered store closures and supply chain disruptions.
Apple said earnings for the three months ending in June rose 25.9% to $2.58 per share on Street-beating revenues of $59.7 billion, with gains in every geographical region and across all product lines.
iPhone revenues rose 2% from last year to a forecast-beating $26.4 billion, despite the COVID-19 headwinds, thanks in part to a solid debut for the $399 iPhone SE, which was launched earlier this year. iPad and iMac sales, meanwhile, rose 22% and 31% respectively as work-from-home shifts powered computer purchases. Services revenues were pegged at $13.2 billion, just shy of Apple's recent record and up 15% from last year.