Apple (NASDAQ:AAPL)
Apple (NASDAQ:AAPL) market cap jumped beyond the $3 trillion mark during Friday’s premarket hours on the heels of a slew of bullish research reports on the business from Wall Street analysts.
According to Citi analyst Atif Malik, investors are underestimating the tech giant’s gross margin increase, who initiated coverage on Apple stock with a buy recommendation late on Thursday.
In his analysis, Malik noted that Apple (NASDAQ:AAPL) is “consistently” gaining market share from Android smartphones, that it is benefiting from a higher blend of iPhone Pro and iPhone Pro Max models, that it is continuing to gain ground in China and India, that it is adding high margin Services revenue, and that it is cutting costs by developing its own chips.
Malik also assigned Apple stock a buy rating and the highest price target on Wall Street, $240.
The Apple stock price rose 1.2% to $191.87, surpassing the $3T market value threshold of $190.37.
At the beginning of 2022, Apple (NASDAQ:AAPL) market capitalization crossed the $3T threshold for the first time.
This week, Apple (NASDAQ:AAPL) was also lauded by Wedbush Securities analyst Dan Ives, who said the business may be valued at as much as $4T in the next years.
With double-digit growth expected in services revenue this year, Apple (NASDAQ:AAPL), headed by Tim Cook, is “playing chess while others play checkers,” as Ives puts it. The company’s services-related revenue in fiscal 2020 was around $50 billion.
As Ives explained to investors in a letter, Apple (NASDAQ:AAPL) services revenue has “so much potential that we now assign a valuation in the $1.4 trillion range.” He said this is the “key” to the valuation re-rating that he expects to continue to take place around Apple stock.
Ives also said that the upgrade potential around the iPhone has been “severely underestimated” by Wall Street and that a “mini super cycle” may be on the horizon with the release of the iPhone 15.
Featured Image: Pexels © Kartikey Das
