Apple shares rebound on Tuesday, J.P. Morgan revises up price target on the stock on optimistic iPhone outlook

J.P. Morgan on Tuesday revised up its 12-month price target on Apple Inc (AAPL) from $233 to $239, as research by analyst Samik Chatterjee suggested a stronger iPhone replacement cycle in 2020 than previously anticipated.

The firm also maintained an “Overweight” rating on the stock.

Apple shares closed higher for the fifth time in the past twelve trading sessions on NASDAQ on Tuesday. The stock went up 0.61% ($1.22) to $201.24, after touching an intraday high at $201.54, or a price level not seen since July 5th ($205.08).

Shares of Apple Inc have added 27.58% to their value so far in 2019 compared with an 18.86% gain for the benchmark index, S&P 500 (SPX).

In 2018, Apple’s stock went down 6.79%, thus, it underperformed the S&P 500, which registered a 6.24% loss.

Chatterjee raised his iPhone shipment forecast for 2020 to a total of 195 million units from 185 million devices, as expected previously.

The analyst also revised up his full-year 2020 earnings forecast to $13.00 per share from $12.85 per share previously, while his full-year 2021 earnings forecast was raised to $15.30 per share from $15.10 per share.

“The incrementally positive volume outlook for 2020 is likely to drive upgrades to consensus earnings expectations, in turn driving positive sentiment for the shares and marking a significant change from downward revisions to near-term earnings over the last few months from continued concerns around the impact of the U.S.-China trade war/slowdown in China,” Samik Chatterjee wrote in an investor note.

Analyst stock price forecast and recommendation

According to CNN Money, the 36 analysts, offering 12-month forecasts regarding Apple Inc’s stock price, have a median target of $216.00, with a high estimate of $245.00 and a low estimate of $150.00. The median estimate represents a 7.33% upside compared to the closing price of $201.24 on July 9th.

The same media also reported that at least 20 out of 42 surveyed investment analysts had rated Apple Inc’s stock as “Buy”, while 18 – as “Hold”. On the other hand, 3 analysts had recommended selling the stock.