iPhone 6 Release Tagged as Apple Inc. Major Growth Driver
Apple's (NASDAQ:AAPL) stock price target has increased with analysts predicting strong demand for the iPhone 6. They also expect the company to release new product categories that will further drive growth. According to reports, RBC Capital has raised its price target for Apple shares to $100.
RBC analyst Amit Daryanani has increased his split-adjusted price from $96 to $100 per share. Before Apple's stock split, the price target by RBC was $675 per share. He is only one of several analysts who have increased their price targets as Apple continues to rally in the stock market.
Apple's surging stock may be boosted further by the stock split as the company makes it possible for more people to buy shares of the company. Since the stock split was announced in April along with Apple's earnings report, the stock has increased 24 per cent. The increase has led to the creation of over $100 billion in shareholder wealth, according to reports.
Analysts also factor in the company's Beats Electronics deal with many wondering what it means for the Apple. CEO Tim Cook said bringing Apple and Beats together will lead to "amazing developments" that Apple's customers will love. Apple believes in the relevance of music to life. He added music has a special place in Apple and it is for this reason that the company continues to invest in music to create "the most innovative music products and services in the world."
Since the company's earnings report more than a month ago, Apple's stock has climbed 18 per cent. The stock has gained ten times more in the S&P 500 with a big boost coming from Apple Inc's announcement of a stock split, bigger share buyback and dividends.
Piper Jaffray analyst Gene Munster believes Apple stock is not overvalued.
Munster said Apple's bigger-screened iPhone may justify the stock price.
He said Apple Inc has "a lot of important stuff" coming by the end of the year due to the company's spending on research and development. Munster added that it would be irrelevant if Apple will release the iPhone 6 with a bigger screen on June 2 or in December since everyone has been "waiting years for this."
The analyst said Apple has already made some significant investments and they would pay off for the company. According to reports, Apple has spent $14 billion on research and development since 2011. Previous data showed the Cupertino-based company spent only $8.1 billion between 2001 and 2010.