Katy Huberty of Morgan Stanley ups Apple stock target to $310, with potential for $400/share down the line

Mon, May 24, 2010

Finance, News

In a recent investor note, analyst Katy Huberty of Morgan Stanley upped her 2011 iPhone sales estimate to 61.5 million units, a whopping 25% higher than the current consensus on Wall Street. Factoring into Huberty’s newfound bullishness on Apple are a few factors which Fortune summarizes thusly:

  • The percentage of current iPhone customers planning to upgrade rose sharply from 18% in Nov. 2009 to 58% in March 2010. Huberty estimates that the combination of a growing installed base and a rising upgrade rate could yield 19 million upgrade units in 2011.
  • She expects Apple to cut the price of the iPhone 3GS to $99. If Apple and AT&T could also find a way to cut monthly service costs to $75 from about $90 today, demand for iPhones, she estimates, would increase by another 7 million units per year.
  • According to the Alphawise survey, 16.8% of Verizon subscribers say they are “very likely” to purchase an iPhone when and if it becomes available on their network (in the second half of 2011 in Huberty’s base case, first half in her bull case). This could add another 8 million iPhones per year.

Notably, in, Huberty’s best-case Bull scenario, she sees Apple’s share price reaching $400.

via Apple 2.0


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