Longtime technology analyst Dan Ives reportedly predicts Apple Inc.’s stock price can soar at least 40 percent from current levels.
Ives has initiated coverage of Apple at his new firm with an “outperform rating” and a 12-month price target of $310, a good 40 percent higher than the current going rate (AAPL) of $220 a share, CNBC reported.
"Many of the growth fears on the Street have been alleviated around Apple in the near term," Ives, now at Wedbush Securities, told CNBC.
The analyst says he wouldn't be surprised to see 350 million iPhone units upgraded over the next 12 to 18 months.
"With positively trending average selling prices that we believe can approach about $800 in fiscal 2019 and healthy gross margins heading into this 2019 product cycle that are showing no signs of abating ... we believe many of the growth fears on the Street have been alleviated around Apple in the near term," Ives said in a note to clients Thursday.
The analyst also highlighted the company's services business as an area where he expects growth in the coming years.
"In our opinion, that's the linchpin. Because when you look at a sum-of-the-parts, Services: we think that business alone is about half a trillion, I'll call it $450 billion," Ives told CNBC.
"That's really what the Street's starting to reanalyze."
"We think when you do a sum-of-the-parts, the core iPhone business is worth about $1 trillion and half a billion for the Services," he said.
To be sure, Apple created a media buzz Thursay when it said it will hold a product announcement Oct. 30 in Brooklyn, New York, likely to unveil new iPads and Mac computers.
The invitation to media reads, "There’s more in the making," without specifying what would be introduced, Bloomberg reported.
The Cupertino, California-based technology giant is planning the biggest revamp to the iPad Pro since it first went on sale in 2015, as well as a lower-cost MacBook laptop and a new Mac mini desktop, Bloomberg News reported earlier this year.
On its website, Apple said the event will be live streamed. This will mark the first Apple product introduction to take place in New York since the company unveiled its digital textbooks service in 2012. It is, however, the second Apple product launch outside of California this year. In March, the company announced new education software and an update to the entry-level iPad at a Chicago-area high school.
The October launch, the month in which Apple has previously debuted new Macs and iPads, will take place at the Brooklyn Academy of Music’s Howard Gilman Opera House.
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