iPhone 14 Strength and Services Strength Drive Apple Target Up at Wedbush

18 AUGUST 2022 - Saying hold my guac-infested, tequila-soaked crudités to the $201 Credit Suisse price target is Wedbush analyst Daniel Ives. Apple 3.0 had the Wedbullish analyst upping his price target on Apple shares Wednesday - after months at $200.

In a note to clients, the analyst says the ramp-up for iPhone 14 seems to be running smoothly. He still likes talk of 90-million iPhones ordered for launch, showing no weakening of demand versus the iPhone 13 launch despite macroeconomic uncertainty. “In particular,” the analyst says he and his team:

…believe Apple is expecting another heavy iPhone Pro and Pro Max mix shift which is a clear positive for ASPs heading into FY23. While the base iPhone will stay at the same price we believe a $100 price increase on the iPhone 14 Pro/Pro Max is likely in store given component price increases as well as added functionality on this new release.

Also, there’s his belief that ~240 million iPhones are due for an upgrade (having not been upgraded in three-and-a-half-years). And - have you heard the Apple Services story? Well it’s a good story. Ives thinks Apple Services revenue will hit roughly $90B in FY23 and pass $100B in FY24. “In a nutshell,” concludes the note:

…we believe Apple's growth story remains well intact with clear momentum around iPhone 14 around the corner despite the shaky macro. Apple remains our favorite tech name.

With that, Mr. Ives maintains an “Outperform” rating on Apple shares. He’s upped his price target on the shares from his age-old $200 to what looks to be a Street high $220.