Morgan Stanley lifts Apple stock price target ($515 to $720)
We’re wondering just how big Apple can get as the company is still seeing phenomenal growth. Only a week after we told how one analyst had raised Apple’s stock price target to $710 per share, news today is that investment bank Morgan Stanley has now raised its stock price target to $720 from $515.
Yesterday at close of market trading Apple had reached another stock high, up 2.92%. Since the beginning of 2012 shares have risen 40% to $568.10. Morgan Stanley analyst Katy Huberty told of the price target rise to $720 in a note to investors yesterday where she also said that investors are still underestimating Apple’s strength right now. Huberty added that in a bull case scenario stock could even rise as far as $960 by March 2013 and also added Apple to Morgan Stanley’s Best Ideas List.
Such increases in price targets are pretty incredible and Apple Insider also reports that last week another analyst from FBN Securities had set an AAPL price target of $730, a Wall Street record. These target rises are largely down to the adoption of tablets for business use, the upgrade cycle to a LTE iPhone later this year and continuing iPhone, iPad and Mac growth spurred by new carriers. Taking a look at tablets for the enterprise market for example, shows that 56% of companies in the U.S. now use tablets for business and with this in mind Huberty believes that iPad sales for enterprise could reach up to 9 million units next calendar year, earning Apple $5 billion in revenue.
A survey also showed recently that in the US 13% of consumers say they anticipate purchasing an iPad over the next year and Huberty notes that globally around 80 million iPads could be sold in 2013. The analyst also talked about how an LTE iPhone could increase sales further and described the “huge untapped markets” such as China and Brazil as further potential for Apple. The new stock price targets represent an EPS of $80 per share and Morgan Stanley cited factors such as forecasts for Apple’s capital expenditure, iPad unit sales and expected iPhone growth as the basis of its “reasonable” case, along with other factors.
Meanwhile the Bear Case valuation from Morgan Stanley was put at $405 and potential risk factors named included lower carrier subsidies, more competition at the low-cost end of the market and the growth of Microsoft Windows 8 amongst others . We’re interested to hear what you think about the latest Morgan Stanley Apple stock price targets so let us have your comments on this.