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Apple on Track to Beat Earnings Estimates Again; Target Price $210 in Best Case

The consumer electronics giant Apple would post its fiscal first-quarter earnings of $1.88 per share, which represents year-over-year growth of nearly 12% from $1.68 per share seen in the same period a year ago.

The iPhone manufacturer would post revenue growth of 6% to $118.13 billion. It is worth noting that with a track record of beating earnings per share estimates at all times in the recent five years, Apple is the best FAANG stock in terms of earnings surprises.

Apple is expected to report 1QFY22 earnings after market on Thursday, January 27th and host a call with investors at 5:00 PM ET. In our view, the recent strength in shares is a reflection of investors’ willingness to reward Apple for entering new markets, including electronic vehicles (EV) and the metaverse (with an augmented reality/virtual reality product). Now, we look for comments from management on its future product roadmap to justify the increase in share price,” noted Tom Forte, Senior Research Analyst at D.A. DAVIDSON.

“We are reiterating our BUY rating for Apple (AAPL) and putting our price target of $175 under review ahead of the company reporting 1QFY22 earnings.”

Apple stock slumped over 7% so far this year after surging over 30% in 2021.

Analyst Comments

“We expect Apple (AAPL) to post upside to Dec Q Street ests with an in-line guide for March, although this appears relatively priced in by the market. Revenue stability, upcoming product launches, and expansion into new markets makes AAPL more defensive in a rising rate environment,” noted Katy Huberty, equity analyst at Morgan Stanley.

Apple has the world’s most valuable technology platform with over 1.65Bn active devices, and is entering FY22 with strong tailwinds driven by its strongest portfolio of Products and Services in years. We see multiple tailwinds to drive a re-rating over the next 12 months including 1) continued adoption of 5G smartphones, 2) PC market share gains on the back of new and differentiated Apple silicon driven Macs, 3) increasing monetization of high margin services, and 4) strong cash returns. Longer-term investments in augmented reality, payments, health, autos and home can help sustain growth as Apple captures more of its users time and wallet share.”

Apple Stock Price Forecast

Twenty-seven analysts who offered stock ratings for Apple in the last three months forecast the average price in 12 months of $179.80 with a high forecast of $210.00 and a low forecast of $90.00.

The average price target represents a 9.29% change from the last price of $164.51. From those 27 analysts, 22 rated “Buy”, four rated “Hold” while one rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price of $200 with a high of $358 under a bull scenario and $107 under the worst-case scenario. The investment bank gave an “Overweight” rating on the consumer electronics giant’s stock.

Several other analysts have also updated their stock outlook. Deutsche Bank raised the target price to $200 from $175. Piper Sandler lifted the target price to $200 from $175. Evercore ISI upped the target price to $210 from $200. Baird increased the target price to $185 from $170.

Technical analysis also suggests it is good to buy as 100-day Moving Average and 100-200-day MACD Oscillator signals a strong buying opportunity.

Check out FX Empire’s earnings calendar

This article was originally posted on FX Empire


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