- Apple surged 4% on Monday ahead of its “Hi, Speed” event on Tuesday, where it’s expected to launch its next-generation iPhone 12.
- Wedbush said Apple’s iPhone 12 would represent a “once in a decade” launch, kicking off its 5G supercycle.
- Wedbush said that based on its channel checks, Apple and its suppliers are anticipating “stepped-up demand” for its 6.7-inch iPhone 12 Pro Max.
- Morgan Stanley said in a note last week that strong demand for Apple’s higher-priced iPhone 12 models could help boost the iPhone’s average selling price, leading to more upside for the stock.
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Expectations are high for Apple’s “Hi, Speed” event on Tuesday.
Wedbush said in a note on Sunday that the event, where Apple is expected to launch the iPhone 12, represented a “once in a decade” opportunity for Apple to capitalize on its massive iPhone install base of nearly 950 million users.
Wedbush isn’t alone in thinking that the event will be a big deal for Apple. Morgan Stanley said in a note last week that it expected it to be “the most significant iPhone event in years.”
Shares of Apple jumped 4%, to $121.71, on Monday, leading the market higher and helping technology stocks surge.
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Wedbush said it expected four new iPhones, including a 5.4-inch iPhone 12 mini and a 6.7-inch iPhone 12 Pro Max, which would be the largest iPhone display ever.
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Morgan Stanley said the 6.7-inch iPhone 12 could cost as much as $1,399. Such a price could help raise the iPhone’s average selling price, leading Morgan Stanley to increase its earnings estimates for Apple and suggest the Wall Street consensus was too low.
“Our pricing and mix analysis suggests our prior FY21 iPhone ASP forecast of $754 was too low, and we raise our FY21 iPhone ASP estimate to $772 (+5% Y/Y),” Morgan Stanley said.
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Demand for the larger, higher-priced iPhone is expected to be strong, which could help shares of Apple reach new heights.
“We are seeing Apple and its Asian suppliers anticipate stepped-up demand for the larger 6.7-inch model,” Wedbush said, adding that it sees Apple selling 75 million iPhone 12s, with a “stretch goal” of 80 million units.
Wedbush said it sees 28% upside in shares of Apple, as it expects the stock to hit $150.
“With 5G now in the cards and roughly 40% of its ‘golden jewel’ iPhone installed base not upgrading their phones in the last 3.5 years, Cook & Co. have the stage set for a supercycle 5G product release which should drive shares further in our opinion,” Wedbush said.
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