Finance Link April 12 (Editor: Huang Junzhi) Among last year's "Big Seven Tech Titans," aside from Tesla, Apple has been the worst-performing major tech stock, with a decline of around 6% year-to-date. Whether due to decreased demand or intensified competition, Apple has faced exceptional challenges in 2024.
However, JPMorgan Chase says this hasn't dampened enthusiasm among hedge fund investors, who are awaiting future upside potential. The bank outlines that they're awaiting an iPhone upgrade cycle driven by artificial intelligence (AI) dominance, along with a slowdown in valuation premiums.
These same factors underpin JPMorgan Chase's bullish view, with a target price of $210 per share. This implies a further increase of around 20% from current levels. As of Thursday's US market close, the stock rose by 4.33%, to $175.04.
Specifically, JPMorgan points out that investor interest in Apple's increasingly buoyant prospects stems primarily from expectations of the AI boost, much like the 5G upgrade propelled the stock in 2020.
JPMorgan forecasts that the iPhone 17 will be Apple's first "AI smartphone," slated for release in September 2025. Therefore, the bank anticipates iPhone sales to accelerate to 240 million units by 2026.
"Compared to the more modest outcomes expected for fiscal years 24 and 25, the product cycle will drive our forecasted revenue and profit growth for fiscal year 26 to 14% (7% higher than the general expectation) and 21%, respectively," the bank wrote in its latest report.
Additionally, Apple's stock has fallen by 6% this year, placing it at the low end of a range of price-to-earnings ratios, much like the momentum of the 5G cycle. However, despite upwardly revising expectations for 2026, the bank still anticipates near-term downside risks for Apple and advises investors to remain cautious.
Similarly, notable strategist Dan Ives of the US investment bank Wedbush also expressed support for Apple this week. He suggests that Apple's stock could still see significant gains this year, maintaining its "outperform" rating and a target price of $250, the highest on Wall Street.
In his latest report, he lists five bullish reasons, including expectations for AI. Wedbush predicts that Apple will announce its progress in generative AI at the June global developer conference.
