With the New Year just around the corner, Apple Inc. (NASDAQ: AAPL) is putting the finishing touches on what has been a historic year for the company and will serve as a launching pad for 2020 to be the “year of an iPhone supercycle.” As a result, Wedbush sees tremendous upside in the stock, issuing the highest price target on Wall Street.
Wedbush believes the underlying iPhone demand remains comfortably ahead of Wall Street and original expectations for fiscal 2020, with 185 million to 190 million units now for Apple to hit with positively trending average selling prices. Wedbush further believes 200 million units could be the starting point for 5G Apple smartphone demand as roughly 350 million iPhones, within the 900 million installed base.
Wedbush believes iPhone 11 is just the front end of this current “supercycle” for Cupertino, with a slate of 5G smartphones set to be unveiled in September that will open up the floodgates on iPhone upgrades across the board that the Street continues to underestimate.
At least five iPhone versions will launch in 2020, with the main event the 5G launch in September that could include a number of versions/models. Those final specs will not be finalized by Apple likely until the April timeframe, with the supply chain (and investors) eagerly awaiting this flagship launch.
On the China front, Wedbush estimates that roughly 60 million to 70 million iPhones are in the window of an upgrade opportunity in this key region, and it hears that the lower pricing, better camera technology and Huawei struggles at the high-end of the market are helping Apple with healthy iPhone 11 sales in this key region.
As a result, Wedbush reiterated an Outperform rating and raised its price target to $350 from $325.
Shares of Apple traded up about 1% at $282.81 on Monday, in a 52-week range of $142.00 to $282.88. The consensus price target is $265.61.
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