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Citi: 5 Reasons Apple Stock Will Skyrocket Next Year

Citi: 5 Reasons Apple Stock Will Skyrocket Next Year

(AP/Philip Toscano)

By    |   Tuesday, 13 December 2016 02:35 PM

Apple stock is poised to soar in 2017 for five reasons, according to Citi Research, which repeated a "buy" rating on the company.

Analyst Jim Suva gave the following list in a note to clients Tuesday, CNBC reported:

  •  "iPhone 8 Super Upgrade Cycle driven by newer form factors driving a stronger upgrade relative to the prior 2 cycles"
  •  "Tax reform benefit from reduction in corporate taxes and cash repatriation"
  •  "Sticky user base which drives continued services revenue growth"
  •  "Enterprise push mid term, Applewood longer term"
  •  "Attractive valuation – Shares trade at a slight discount to their 4 year median multiples despite improving fundamentals ahead"

Suva gave an Apple price target of $130. Apple stock was at $115.54, up $2.24, or 1.98 percent in late Tuesday NASDAQ trading.

Suva said Trump's proposal to lower the U.S. corporate tax rate to 15 percent from 35 percent would add 6 percent to Apple's earnings-per-share. Suva said if the company used 25 percent of any repatriation tax holiday proceeds for a stock buyback, it could benefit earnings-per-share by an additional 10 percent.

"Across our coverage universe, we see Apple as a significant beneficiary of Trump tax reforms. Apple is very well positioned to benefit from potential tax reform of either or both a repatriation tax holiday and or a lower corporate tax rate," stated the note.

"We believe iPhone installed base upgrades will take a step up with the launch of iPhone 8," Suva wrote.

The technology titan has been active on other fronts as well.

Apple has held talks about investing in a $100 billion technology fund that SoftBank Group Corp. aims to launch next year, a person with knowledge of the discussions told The Wall Street Journal.

Apple may contribute as much as $1 billion to the fund, which would give the company insight into up-and-coming technologies, said the person, who asked not to be identified because the talks were private.

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Apple stock is poised to soar in 2017 for five reasons, according to Citi Research, which repeated a "buy" rating on the company.
apple, citi, stock prices, shares
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2016-35-13
Tuesday, 13 December 2016 02:35 PM
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