Apple could hit the $3T milestone in 2022 with the help of the iPhone, AR, and other products
Apple’s iPhone growth story is looking robust heading into 2022. The company has been enjoying steady success with the new product categories they released and could encourage them to release the “metaverse” this year.
Some recent data points are supporting Wedbush analyst Daniel Ives’s view that demand for the iPhone 13 is strong, with supply in-demand at an all-time high. Not only is this data likely to continue this trend, but there may be some more supply to come for Apple Store checks.
However, while there have been many supply chain issues, like the iPhone X and the scandal that surrounded it, Ives said we’ll see a huge impact on Apple’s stock values. He believes that in 2022 we’ll see a huge increase in this company’s share prices.
For example, the analyst estimates that Apple could ship north of 40 million iPhone units during the busy holiday season despite the supply headwinds. Additionally, he believes iPhone growth both domestically and in the key market of China is trending up.
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Heading into 2022, Ives continues to believe that Apple will enjoy a robust “iPhone supercycle.” Additionally, the introduction of a new AR headset or “Apple Glass” device could add at least $20 to Apple’s sum-of-the-parts valuation. As such, the annual growth rate is expected to be higher than 60% in the near term.
We believe the stock price will continue to rise as Apple executes well with its upcoming product releases. The bull/bear debate on Apple centers around how sustainable this product cycle is even into 2022 and the valuation the stock deserves, although we believe the risk/reward is very favorable at current levels for this ‘safety blanket’ tech stalwart.
He also reiterated his belief that Apple could hit a $3 trillion market valuation in 2022, or sooner. Ives is sticking with his 12-month $200 price target for Apple shares, based on a sum-of-the-parts valuation using Wedbush’s estimates. Every company’s valuation is different, and Apple has a lot of great assets that they’ve built up over time. Their Services division was valued at 18 times the earnings and their hardware division was valued at 7 times earnings or 2.1 trillion dollars.