Apple Inc. (AAPL): Analysts’ Opinion Mixed Ahead of Earnings Release and New Products Launch


Apple Inc. (NASDAQ:AAPL) had beaten the street’s expectation for 5 consecutive quarters and expected to do so in the quarter that ended as well. iPhone always remains as the biggest contributor to Apple, contributing to 57% of company’s total revenue in the first half of the year. iPad contributes to 18% of Apple’s total revenue.

Apple Inc. (NASDAQ:AAPL) stock keeps soaring up and has increased by approximately 17% in the last quarter. Many Analysts doubt that if this would continue and some feel that the products in the queue would make sure that it will continue to increase. Jennifer Schonberger on Fox Business reported the views of many Analysts on Apple.

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Schonberger said that Apple’s shares have increased by nearly 26% since mid April and the has beaten the S&P 500 by 10 percentage points.  She thinks that Apple’s stock keep soaring up mainly due to a dividend hike, increase in stock buyback options and the 7-to-1 stock split. Many investors are excited about Apple Inc. (NASDAQ:AAPL)’s brand new products like larger screen iPhone 6 and iWatch due later this year.

Scott Kessler, Chief Analyst at S&P Capital IQ thinks that Apple’s shares are fairly valued at the moment. But after keeping the “Buy” rating for Apple’s stock for five continuous years, they have downgraded it to ‘Hold’ earlier in May. “It seems like a limited growth story with sentiment having caught up,” Schonberger quoted Kessler.

On the other hand, Michael Walkley, Senior Analyst at Canaccord Genuity thinks that Apple stock would see a big boost with the iPhone 6 launch in September. He thinks that Apple Inc. (NASDAQ:AAPL) would have a record iPhone 6 sales. He also said that from a survey in June-July, many people have put on hold the idea of changing their phones and eagerly await for the iPhone 6 release. He had raised his target price for Apple’s stock from $102 to $112 ahead of iPhone6 launch later this year.

Paul Meeks, Saturna Capital Portfolio Manager feels that after iPhone6 launch, Apple Inc. (NASDAQ:AAPL) would be hard pressed to meet the 10% growth target.

“You will continue to have bursts of outperformances with new product launches or new iterations of current product like iPhones of iPads. But after that it’s a steady lull,” Schonberger quoted Meeks.

Schonberger considers that Apple Inc. (NASDAQ:AAPL) is building a bridge of economic growth through stock buyback, dividend hike and innovation. She feels that larger screen iPhone 6 might capture larger market share, but it is not a game changes that Apple is looking for to impose a steady continuous growth. She thinks that Apple Inc. (NASDAQ:AAPL) had to come out with a brand new product which can completely change the market. If Apple is not doing that, then she recommends that Investors who are looking for larger profits need to look elsewhere.


Disclosure: None

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