The Apple stock has received a price target boost, indicating that gains are still expected despite a temporary slowdown in spending. According to analysts at KeyBanc Capital Markets, Apple’s stock may surpass its milestone $3 trillion market capitalization with a new price target of $200 per share.
Although shares in Apple were up in premarket trading, they have not yet reached the $3 trillion market cap level. However, the increased price target from KeyBanc suggests that this milestone may not be far off.
The analysts at KeyBanc, led by Brandon Nispel, raised their price target on Apple despite concerns about a spending slowdown. Their analysis of proprietary data from credit and debit card customers revealed a 23% increase in indexed spending on Apple transactions of $400 or more in June compared to the previous month. However, the data also showed a 15% decline quarter over quarter, which is worse than the historical average.
Nispel explained that the data indicates that Apple may see below average growth in the third quarter of 2023. He cited factors such as softness in Apple’s direct channel data and pressure on domestic iPhone sales from slowing U.S. carrier activity and lower upgrade rates.
Despite these concerns, Apple’s stock may not be negatively impacted, as the company continues to introduce new products that are viewed as catalysts for the stock. Additionally, Apple’s position as one of the largest public companies may make it increasingly considered a safe haven in turbulent markets.
The KeyBanc analysts stated, We believe the bull case for the stock with excitement around new products and investors reaching for safety is resulting in an elevated multiple. This sentiment highlights the positive factors that are driving Apple’s gains and contributing to its potential reach of the $3 trillion market cap.
In conclusion, Apple’s stock is expected to continue gaining momentum, despite the possibility of a spending slowdown. The company’s focus on releasing new products and its strong position in the market may help it surpass the $3 trillion market cap milestone. Investors will be closely watching Apple as it approaches this significant level of valuation.
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