Wedbush adds Apple to its Best Ideas list

The recent sell-off represents a great entry point, says analyst Daniel Ives.

From a note to clients that landed on my desktop Wednesday:

We are adding Apple to the Wedbush Best Ideas List as the recent sell-off creates a golden buying opportunity with a $3 trillion valuation on the horizon for Cupertino in our opinion. Coming off an historic December quarter for Apple in which the company crushed iPhone expectations, the Street has been anticipating some modest cuts to iPhone forecasts for FY21 and reflected in the stock's sell-off over the last month. To this point, our recent Asia checks overall came in bullish yet again with 230 million+ units looking like the bogey for 2021 with an initial build forecast for iPhone 13 which could be a "game changer" indicating the supercycle party in Cupertino is going well in FY22.

Maintains Outperform rating and Street-high $175 price target ($225 bull case).

My take: Wait, Apple wasn't already on Wedbush's Best Ideas list?

6 Comments

  1. Michael Goldfeder said:
    It’s somewhat reminiscent of the term: “Double Secret Probation” from the movie: “Animal House.” An all time classic!

    The only thing better than being a shareholder of the first: “3 trillion valuation company”, is having less shareholders.

    3
    March 10, 2021
  2. Jerry Doyle said:
    The iPhone 13 (or 12S) should revert back to a September keynote announcement. That’s almost less than six months out. Do not underestimate the number of consumers who for various sundry reasons skipped the successful iPhone 12 launch. For example, it made little sense in my state to consider a 5G phone when 5G isn’t available anywhere in the entire state. Some iPhone users are thinking of holding their existing phones longer and waiting until 2002. It’s the 5G infrastructure not being in place that is delaying some buyers. I have a feeling this super cycle is going to be extended over three years with additional buyers coming from Android. Apple also has new product line-ups in other device categories. I am excited about an all-new redesigned iMac and iPad Pro line-up. Many rumors abound that the Watch Series 7 will have glucose monitoring. I find what makes me upgrade unequivocally to a new Watch is when Apple adds another innovative health monitoring feature. Upgrade then becomes a “no brainer.”

    3
    March 10, 2021
  3. Fred Stein said:
    Simple math:

    230M is only 23% of the iPhone IB.

    Right on bro’s – Jerry and Joseph. Early innings for this super cycle.

    3
    March 10, 2021
  4. Fred Stein said:
    OT, but gotta say it:

    Apple’s pay out ratio is 21.6%. Expect a nice dividend increase as they move to the norm of 25%

    3
    March 10, 2021
    • David Emery said:
      I had to look up “pay out ratio”. Posted here so anyone else who didn’t know this won’t feel stupid 🙂 🙂 (Presumably Fred’s calculation includes dividends and buy-backs.)

      The payout ratio is a financial metric showing the proportion of earnings a company pays shareholders in the form of dividends, expressed as a percentage of the company’s total earnings. On some occasions, the payout ratio refers to the dividends paid out as a percentage of a company’s cash flow. The payout ratio is also known as the dividend payout ratio.

      1
      March 10, 2021

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