In the latest addition to a growing list of analysts and investment firms, the investment firm CLSA recently upgraded their stock target for Apple shares to $400, up from a previous target of $365.
Our recent survey of 1,039 US consumers and supply chain checks suggests our iPhone unit estimates are too low, especially when we consider the likely early-2011 launch of iPhone at Verizon in our forecasts for the first time. We also have increased confidence in our iPad forecasts (both absolute units and share) and the likelihood of iPad2 coming to market by CQ2. Thus, we bump up unit projections for iPad as well for H2 of C2011. We raise our F2011 (Sept) and F2012 EPS estimates from $18.65 and $21.15 to $20.00 and $23.00, respectively. On our new and higher EPS estimates, we think the stock can trade to $400 (vs prior target of $365) over the next 12 months or ~20x our F2011 EPS estimate.
While $400 might sound fanciful, Apple is already trading in the $320 range, and with lots of room for iPhone and Mac growth ahead, the opportunities to significantly increase revenue going forward is tremendous. Moreover, given Apple’s current earnings and future growth projects, $400 really isn’t all that far fetched.
Writing for the Chicago Sun-Times, Dave Roeder reports:
For investors, AAPL also is an evolving story. It’s classified as a ‘large growth’ stock, which means that it’s seen as a company with its best days in front of it. The price of the stock is supposed to reflect prospects rather than current results. And the current price of the stock, $320.56, seems rich to many,” Roeder reports. “But is it really? Based on price-earnings measures, Apple doesn’t trade at much of a premium compared with its tech brethren and it’s about even with the average for the S&P 500, even though it’s growing much faster than most companies in that index.
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