Merrill Lynch raises its Apple target to $250
August 21, 2018 by Steven M. Peters
The wave of price target adjustments has begun.
From CNBC:
Bank of America Merrill Lynch bumped its price target on Apple stock up to $250 per share from $230 per share on Tuesday, citing confidence in the tech giant’s push to diversify its mobile application offerings.
“The strong growth rate of non-gaming categories gives us increased confidence in the sustainability of strong App Store sales, and reduces risk of dependence on one single category of Apps,” analyst Wamsi Mohan wrote in a note.
“We raise our Services revenue estimate for 2019 by about $800 million and factor in slightly higher margins, and reiterate Buy on strength in Services, stable hardware & strong capital returns,” Mohan said.
The firm’s analysis of third-party data “indicates” that mobile games contribution to the App Store’s revenue is coming down, despite remaining the largest contributor overall. App Store revenue growth each year is “now being driven by non-gaming categories,” Mohan said.
“Categories like Entertainment Apps and Photo & Video Apps are becoming an incrementally larger portion of the App Store,” Mohan added.
My take: Bank of America/Merrill Lynch was already bullish on Apple. Mohan’s new $250 price target is the second-highest I’ve seen.
Sponsored: Find a Qualified Financial Advisor
Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.