Bookmark this page and keep checking back for the latest AAPL stock news. We’ll be providing continuing updates as news about the iPhone maker and its shares unfolds. You’ll find analysis, stock trends and more.
UPDATE 9/19/2017: AAPL stock seems to have settled into a steady range today after bouncing around in the wake of the iPhone X event. There’s no doubt that analysts are seeing dollar signs now, what with the price increases for the iPhone 8 and 8 Plus and the $1,000 iPhone X.
Will they keep buying iPhones?
A few now question whether Apple will be able to keep consumers buying its pricey phones, but one analyst has boldly raised her price target for AAPL stock because of a major trend she discovered. It seems that when the company has raised iPhone prices in the past, it actually increased demand for them—if the price increases were paired with innovation. On the other hand, one firm says the company’s weakening innovation has turned it bearish on AAPL stock for the first time ever.
But no matter what you think of the higher iPhone prices, most analysts are pointing out that this will be a key test in price elasticity for Apple’s most important product.
Morgan Stanley boosts AAPL stock price target
In a note dated Sept. 19, Morgan Stanley analyst Katy Huberty said she raised her price target for AAPL stock from $182 to $194 and reiterated her Overweight rating. She seems to be in the minority here as few analysts raised their target prices for AAPL stock following the iPhone X event, although this could change as they spend more time examining the numbers.
Huberty noted a long list of higher-than-expected prices for new Apple devices:
Because of these higher prices, her revenue estimate for fiscal 2018 rises to $301 billion from $288 billion and now is much higher than the consensus of $263 billion. Her fiscal 2018 earnings per share estimate rises to $12.60, which is 15% higher than consensus.
Innovation-led prices increases help demand
Huberty went on to build a case for price increases on its products being a boon for Apple and not a hindrance. Because the company’s products are often seen as a sort of status symbol and people aspire to own them, it can get away with charging higher prices. She found that as iPhone prices rise, so does demand for them and cited three relatively recent examples: the iPhone 6 Plus, the iPhone 5c and SE, and the iPhone 7 Plus.
The Morgan Stanley analyst also noted that loyalty to Apple’s products is on the rise as her April AlphaWise U.S. Smartphone Survey found that 92% of those who planned to upgrade within the next year planned to buy another iPhone. Last year, this metric stood at 86%.
iPhone price elasticity tested
While Huberty is convinced that the higher prices will raise demand for Apple’s products, others are not so sure, or they’re at least worried about supply constraints. Bank of America Merrill Lynch analyst Wamsi Mohan has a Buy rating and $180 price objective on AAPL stock, and he actually slashed 10 million units off his iPhone X estimates, citing the “relatively inelastic pricing” Apple has seen in the past. He described his view on unit numbers as “moderately more cautious,” adding that investors will probably watch for sell-through numbers to judge the new iPhones’ success.
UBS analyst Steven Milunovich also has a Buy rating and $180 target on AAPL stock, and he wrote that the company “is pushing the envelope likely in the belief that its innovation warrants higher prices.” He noted that the iPhone 8 could do well in China because the number 8 is considered lucky and it will be available in gold, while the iPhone X will not be.
Will Apple keep doing well overseas?
His UBS Evidence Lab work regarding price elasticity backs up what Huberty found as far as past trends, but with one finer point: U.S. rather than international consumers. He found that customers overseas seem to be more price-conscious than U.S. consumers.
Because of this trend, he reduced his iPhone X mix to 35% of fiscal 2018’s shipments from the 45% he was estimating previously.
One key theme that has emerged as analysts weigh the price elasticity issue for the iPhone is innovation. Apple feels it can charge more for innovation, and U.S. consumers are willing to fork over the cash for it, although overseas customers might not be.
Most of Wall Street raved about the iPhone X and some of Apple’s other new products after last week’s event, but Orange Peel Investments called the iPhone X “relatively underwhelming” in a post for Seeking Alpha. The firm doesn’t believe Apple’s innovations are “as robust” as they have been previously, and for the first time ever, it now has a bearish view of AAPL stock.
In addition to what the firm feels is a lack of innovation, it also sees AAPL stock as having “finally started to grow into itself.” And finally, Orange Peel Investments believes that the overall market is about to peak, shifting overall sentiment toward the negative end of the spectrum. Such a shift could be bad for AAPL stock, of course.
AAPL stock hovered around its opening price on Tuesday, staying in the $158 to $160 range before closing bell.
PREVIOUS UPDATE 9-8-2017: AAPL stock has just experienced a one-two punch as first one article indicated that the company was having production issues over the summer and now a second suggests that the all-hallowed (note sarcasm) tenth anniversary iPhone X/ 8 will be delayed. But let’s not forget that this isn’t an eleventh-hour realization. Similar reports have been circulating for months in a sort of stutter-step pattern, with one source indicating that there were problems, followed by another source saying that the problems were resolved.
AAPL stock shaken by two new iPhone 8 reports
The Wall Street Journal reported about the summer production issues on Thursday, and AAPL stock pulled back a bit, but then Rosenblatt analysts issued their own report about iPhone 8 production problems today. That second report served as confirmation that this long-time specter that’s been haunting production of Apple’s tenth anniversary iPhone model may actually be happening. As a result, AAPL stock took off immediately at the open and started falling, this time at a faster pace.
The company has invited the media to an event on Tuesday (read this to find out how to watch the live stream), and it’s widely expected that it will reveal the iPhone 8, iPhone 7s and 7s Plus, Series 3 Apple Watch, and other new gadgets. However, it remains to be seen whether any of it will be enough to satisfy Wall Street’s unquenchable thirst for a return to the glory days of AAPL stock.
iPhone 8 will be delayed: Rosenblatt
Rosenblatt analyst Jun Zhang said in a report today that Apple’s suppliers had some serious production problems over the summer. This time, he said the issue is the metal frame for the iPhone 8. This is interesting because the