CNBC: Is Apple at $400 a step too far? (video)

“Analysts have been forced to chase this thing unlike anything we’ve ever seen.” —Dan Nathan

From “Wall Street’s biggest Apple bull says the tech giant could hit $400“:

Wedbush’s Dan Ives makes a big call on Apple. With CNBC’s Courtney Reagan and the Fast Money traders, Tim Seymour, Karen Finerman, Dan Nathan and Guy Adami.

Cue the video:

My take: Straw man alert! Wedbush’s Dan Ives tossed out $400 as a “bull case,” but officially he’s sticking with a price target of $350. At least for now.

See: Wedbush’s bull case has Apple at $400 by end of 2020

4 Comments

  1. Jerry Doyle said:
    “…Analysts have been forced to chase this thing unlike anything we’ve ever seen.” Dan Nathan

    First, I credit PED with illuminating and enlightening the analyst community, the business news media, WS and “Fast Money Traders” to the demonstrative fact how Apple analysts most all were underwater in their Apple target price making the bunch appear incompetent relative to their stated profession. I salute you PED for your contribution and good work.

    I study all things Apple as each of you do except I practice a somewhat different approach to arrive at my projected target prices. Conservatively, I always have been confident that we will see $300 following the 1Q 2020 call, $350 following the 1Q 2021 call and $400 following the 1Q 2022 call. Those targets I truly believe are “modest,” and they are proving to be modest.

    Dan Ives is tossing out the “best-case-scenario” for Apple stock price to hit $400, I presume in a 12 month period. Yes, I agree with Dan Ives that under a best possible scenario that we could see $400 following Apple’s 1Q 2021 call. That is not unreasonable under a best-case-scenario.

    Apple is hitting on all cylinders. Their installed base of 1.4 billion continues to grow. A complete new 5G generation iPhone is coming later this year to begin what all believe will be the start of a “super cycle.” The Apple Watch and AirPods are a spectacular successful company in their own right generating huge streams of new revenues exponentially. New and other innovative products are in the Apple pipeline ready to flow forth. The Services side of the company is poised to ramp up over the coming year and to lift-off the following year. Apple is coming together as this maturing, fully developed, synergistic hardware, software and services business enterprise model predicated on a still growing installed base of over 1.4 billion active daily users.

    Let us just take Apple Pay as one example of how quickly Apple can generate revenues. American Express issued its first credit card in the 1950s. I believe the company has around 40 million cardholders in the US. Although Apple has not told us the number of Apple credit card holders it has active, something tells me that almost overnight Apple achieved in numbers of Apple Card holders what it took AMEX over a half century to achieve. That folk, is what we are dealing with when we talk about Apple’s potential to continue growing revenues going forward.

    So yes, a $400 price target is definitely reasonable under the best case scenario.

    4
    January 7, 2020
  2. Gregg Thurman said:
    Does anybody know how many active smartphones there are worldwide?

    0
    January 7, 2020
    • Fred Stein said:
      Call it ‘reverse capitulation’, as analysts give up their old iPhone counting, SmartPhone maturation, can’t innovate and other regurgitated nonsense.

      Ironically nothing really changed in the last 12 months. Apple delivered on Tim Cook’s promises. In June 2017, Tim said he’d double services revenue by end of 2020. In Nov 1 of 2018, he said iPhone units don’t matter.

      Tim Cook also said that Apple’s biggest contribution will be in health, a $16T global business. Maybe in five years the talking heads will “discover” this for us.

      1
      January 7, 2020
  3. Jerry Doyle said:
    @ Gregg Thurman: “… Does anybody know how many active smartphones there are worldwide?”

    That is a good question Gregg. I am certain that I heard Tim Cook use the 1.4 active install base figure of iPhones. I know that I have seen 1.4B used in print. Notice in the video that Dan uses 1.5B install base. It’s been about a year since I heard Tim C say 1.4, so perhaps we now are at 1.5. The 1.4B, though, includes multiple iPhones used by one person. For example, I use three iPhones. Other figures I have heard used is 1B and 900,000,000. These last two figures are “active users” instead of “active devices.”

    @Fred Stein: I agree fully with you on Tim C’s constant refrain that Apple’s legacy will be in the fields of Health & Wellness. Health & Wellness is a “humongous” industry. While you use a $16T global business figure, I never have been able to find definitively a figure that all folk agree on as being how huge this industry is, except it is HUGE! Tim C reiterates time and again that Apple will play an integral part in this industry going forward. Yet, it is as if Tim’s words are never heard and digested by analysts.

    The Health and Wellness industry is going to explode, getting even more humongous in the coming years. With the advancements in medical science, new and innovative rehabilitation technologies, along with the proliferation of modern and novel designer drugs people are going to live longer and more productive lives. Concomitantly, they will need (and demand) monitoring of their physical being so that they may live more independent lifestyles. Apple will be an integral player in this arena. Yet, one never hears analysts talk about Apple’s move into Health and Wellness.

    You are correct, though, Fred. In about five years the talking heads once again will find themselves blindsided, humping hard to catch up in their target prices as they discover this integral burgeoning component of Apple’s business.

    0
    January 7, 2020

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