Apple Inc. (NASDAQ:AAPL) is expected to unveil the new iPhone 5S and a lower priced iPhone 5C tomorrow. In anticipation of that unveiling, Evercore Partners analysts have raised their price target on the company’s shares, saying that the setup looks good going into it.
Apple looks good going into iPhone 5S unveiling
Analysts Rob Cihra and Edison Yu issued a report to investors reiterating their Overweight rating and increasing their price target from $550 a share to $600 a share. They said they can’t imagine why Apple again decided to “cram the refresh of 70% of its revenue engines into a 2-month window.” However, since it’s been 11 months since the last major product introduction, which was the iPad Mini last October, they see a good setup into tomorrow’s launch event.
They note that it looks like China Mobile will finally start carrying Apple Inc. (NASDAQ:AAPL)’s iPhone by the end of this year. They expect the carrier to offer both the TDD-LTE iPhone 5S and 5C. They note that China Mobile holds 11 percent of the world’s mobile subscribers.
Expectations for Apple products
The Evercore analysts believe that the iPhone 5S will take back the high end of the smartphone market. They think the rumored fingerprint sensor and the faster A7 processor will drive that charge. They believe the processor will boost 64-bit performance up to two times, which in terms will drive the newly redesigned iOS 7 “back out in front of the competition.” They also note that Apple Inc. (NASDAQ:AAPL) is said to be adding a gold color option for the iPhone 5S and offering the plastic iPhone 5C in five different colors.
They adjusted their estimates slightly ahead of tomorrow’s unveiling. They increased their September quarter iPhone estimates to 32 million, which is a 19 percent increase year over year. Previously they had estimated 30.4 million for the quarter.
They also lowered their estimates for the iPad to 14.5 million, which is only a 3 percent increase over the same quarter last year. Their previous estimate for the tablet was 16 million during the September quarter. They also maintained their above-consensus estimate for 56 million iPhones in the December quarter, with 51 percent of them being the high end handsets and 49 percent being the low end models.