Apple Inc. (AAPL) has been rated "Outperform" by Wedbush, with a 12-month price target set at $325, reflecting confidence in the company's strategic direction and product cycle. The report highlights the iPhone 16's strong performance, surpassing its predecessor, the iPhone 15, and contributing to a record number of upgraders in the December quarter. Apple's active installed base reached 2.35 billion devices, marking a 7% y/y growth, which is central to Wedbush's bullish thesis.
The report is centered around Apple's recent earnings release, where the company reported Q1 FY25 revenue of $124.30 billion, up 4% y/y, slightly above the Street's estimate. Despite a 1% y/y decline in iPhone revenue, strong performances in services, iPad, and Mac segments offset this weakness. Notably, services revenue grew 14% y/y to $26.34 billion, surpassing expectations.
Wedbush anticipates further growth as Apple Intelligence rolls out in new markets, including China, which is expected to drive a rebound in the region's performance. "This was a clean quarter for Apple that marks the beginning of a multi-year upgrade cycle from iPhone 16 to iPhone 17," states Daniel Ives, highlighting the potential for continued growth.
Apple's stock was trading at $245.85, up 3.48% on January 31.