Apple stock (AAPL) traded higher on Wednesday on Morgan Stanley comments and Nasdaq strength. Recent observations suggest Wall Street estimates for Apple (AAPL) are too low. Huberty raised her revenue forecasts for Apple services to account for strong App Store sales and accelerating growth. It was also noted that Alphabet (GOOGL) pays Apple for internet search traffic on its devices. She went on to repeat her overweight rating and target price on Apple stock, viewing the recent selloff as a buying opportunity. That said, she cut her target on Apple stock to 156 from 164.
She is “increasingly convinced that consensus services forecasts over the next two-plus years are too low” in a note to clients,
Apple Daily
Institutions have been busy buying shares at a discount to 52-week highs. Stochastic, MACD and RSI are bullish. Price action closed above the 50d moving average on Wednesday, after bouncing off Volume by Price (VBP) support (blue shaded zone).
Note the 21d moving average is turning upward. A cross above the 50d moving average seems likely, so we are looking for price action to gain some momentum going into earnings.
Apple Services 14% of Revenue
Apple’s services business is the company’s second-largest profit engine. Services accounted for 14% of the company’s total revenue in the most recent quarter. These services include the App Store, AppleCare, iCloud, Apple Pay, Apple Music, Apple TV+, Apple Arcade and other offerings.
Cowen analyst Krish Sankar maintained his outperform rating on Apple stock with a price target of 153. Sankar said he believes the Apple News+ service is a “key pillar” in the company’s growing subscription services.
He estimated Apple’s News app advertising and News+ subscriptions could reach $2.2 billion in revenue by fiscal 2023. more than doubling the “subscriptions” revenue in fiscal 2020.
Watchlist Performance
Stocks from the weekly watchlist ranked by performance. We’re looking for these stocks to continue their relative strength and performance into Q1 earnings next week.
| SYMBOL | NAME | SECTOR | CLOSE | CHG | VOLUME |
|---|---|---|---|---|---|
| VUZI | VUZI – Vuzix Corp. | Technology | 28.94 | 0.82 | 11819764 |
| INMD | INMD – InMode Ltd. | Health Care | 79.79 | 1.57 | 660834 |
| AMZN | AMZN – Amazon.com, Inc. | Discretionary | 3279.39 | 55.57 | 3338489 |
| MTDR | MTDR – Matador Resources Co. | Energy | 24.56 | 0.40 | 1325525 |
| ARES | ARES – Ares Management, LP | Financial | 55.65 | 0.81 | 2640384 |
| FOUR | FOUR – Shift4 Payments Inc | Technology | 94.41 | 1.33 | 1128430 |
| AAPL | AAPL – Apple, Inc. | Technology | 127.90 | 1.69 | 83148742 |
| USB | USB – US Bancorp | Financial | 56.81 | 0.58 | 5068815 |
| LRCX | LRCX – Lam Research Corp. | Technology | 658.78 | 6.30 | 1465170 |
| BAC | BAC – Bank Of America Corp. | Financial | 40.05 | 0.36 | 43071249 |
| MSFT | MSFT – Microsoft Corp. | Technology | 249.90 | 2.04 | 22706563 |
Happy Trading,
Vinny
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