JP Morgan sets a price target of $ 272 for Apple's stock, sees a "significant advantage" for the company based on a leading position in the smartphone market and the services that Apple uses to report that revenue.
In a note released Thursday, the analyst of JP Morgan, Samik Chatterjee, gave Apple an assessment of overweight & # 39; and set a $ 2019 dollar target of $ 272. Apple's stock closed at $ 220.42 on Wednesday.
The note is entitled Time for Apple Picking: Initiate OW on compelling services transformation, Ripe Installed Base, Core Capital Deployment.
"Although Apple's leading position in the market for premium smartphones is well understood by investors, we still see a significant benefit from current levels," writes Chatterjee.
Morgan joined other analysts and praised Apple's transition to a services-based company, rising ASPs for the iPhone, ongoing company innovation, "undervalued position for continued robust growth of the installed base", the recent share buy-backs and a strong balance sheet. Morgan sees that Apple uses for "oversized redemption of shares or MA & # 39 ;.
Chatterjee, like Gene Munster and several other analysts, sees services in the future as a key for Apple.
"We are convinced that the transformation to services, led by growth in both installed devices and service revenue per device, better follows investors' expectations, including realizing a $ 48 billion revenue target by FY20E ahead of the schedule, "wrote the analyst. "The ability for services currently comes primarily from purchases in the App Store and there are several emerging drivers, such as Apple Music and Apple Pay, which should continue to generate strong growth."
Chatterjee also sees "robust high single-digit growth" in the plant's plant base, which in turn is likely to increase the revenue from services.
JP Morgan also predicted that Apple will soon offer a "comprehensive media subscription," which will include its video offering, along with the content of newspapers and magazines, at a price of about $ 14.99.