Apple Inc. (AAPL) Stock Rockets to New All-Time Highs

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AAPL stock - Apple Inc. (AAPL) Stock Rockets to New All-Time Highs

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Updates with UBS upgrade, AAPL close.

Apple Inc. (NASDAQ:AAPL) shares finished Tuesday with a new all-time closing high of $143.80, closing just off its intraday high of $144.04 to finish off a 2%-plus gain alongside the broader-market recovery. That also extended a now 23%-plus run in AAPL stock since the start of 2017.

But what exactly is causing the sudden renewed push higher in Apple shares? It looks like a combination of analyst optimism and a few other factors.

The Big Apple Update No One’s Talking About

The newest news on Tuesday was Apple’s relatively muted update to iPhones and iPads to the “Apple File System” — an upgrade to the way Apple devices stored data, which previously was HFS+. Per Apple:

“Apple File System is a new, modern file system for iOS, macOS, tvOS, and watchOS. It is optimized for Flash/SSD storage and features strong encryption, copy-on-write metadata, space sharing, cloning for files and directories, snapshots, fast directory sizing, atomic safe-save primitives, and improved file system fundamentals.”

It’s an important upgrade considering that the Hierarchial File System (HFS), and its upgrade, HFS+, has been in use for more than three decades. The Apple File System should result in faster read and write speeds across Apple’s devices.

It’s nice … but it’s also an unlikely driver for AAPL stock.

Instead, Apple is enjoying a combination of a swing in positive market sentiment, recent upgrades, optimism and the 10th anniversary iPhone.

AAPL Stock Upgrades

Apple received a glowing recommendation from UBS analyst Steven Milunovich on Tuesday, who said AAPL shares could hit $200, though it would take a perfect storm including establishing “new product categories” and buybacks of more than $50 billion per year. UBS believes iPhone revenues will grow by double digits next year, then high single digits in fiscal 2019.

That continued the momentum from other positive analyst notes of late.

Apple received a price-target upgrade from JPMorgan analyst Rod Hall on Sunday, from $142 to $165 (16% upside from here), citing high replacement demand for the upcoming iPhone. He upgraded his estimate for unit sales in fiscal 2018, from 245 million to 260 million, expecting a 48% replacement rate.

He also expects Apple to include a high-powered “iPhone Pro” that will go for about $1,000.

Last week, Nomura Instinet’s Jeffrey Kvaal also raised his price target on Apple stock, also to $165 per share, up from $135. He too believes the upcoming iPhone cycle is going to be much more robust than the current Wall Street estimate, pointing out that while there were 400 million iPhones in use ahead of the iPhone 6 cycle, there will be roughly 665 million by the time the iPhone 8 (or iPhone Edition, or countless other potential names) comes live.

The market is also broadly excited for the iPhone 8 just because of the laundry list of potential options that have been floated out there. Among the potential features?

  • Wireless charging
  • Advanced biometric features
  • Scanning technology
  • New Touch ID technology
  • OLED display (5.8 inches for the base model, 5.15 inches of usable space)
  • Water resistance
  • Updated A11 processor
  • Glass body
  • USB-C port to replace Lightning connector
  • No home button

Of course, some of the features are more grounded in reality than others.

Friendly Chart, Friendly Market

Apple shares also are the beneficiary of a healthy-looking chart.

Despite broadly rising prices, Apple also has managed to work off overbought levels in the Relative Strength Index (RSI) over the past two months. That comes at the same time that Apple, while setting a continuous string of new highs since February, has killed any sort of overhead price resistance.

AAPL stock chart view 1

In other words, technically speaking, the sky’s the limit.

AAPL stock is also moving along with the current — the Dow Jones Industrial Average (of which Apple is a component) is up nearly half a percent on Tuesday, and well on its way toward snapping an eight-day losing streak. The S&P 500 is also up fractionally, as is the Nasdaq Composite.

The flip side? Apple also has been carried down of late along with the major indices, so soured sentiment would be likely to pull AAPL back from its new peaks.

Past that, iPhone 8 rumors will carry (or sink) the stock for the next few months.

As of this writing, Robert Martin did not hold a position in any of the aforementioned securities. 


Article printed from InvestorPlace Media, https://investorplace.com/2017/03/apple-inc-aapl-stock-sets-new-all-time-highs/.

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