Apple's stock ticked up on Monday, as analyst Shaw Wu of ATR changed his rating from "Neutral" to "Buy," explaining that was more in line with his firm's long-term view. The prospect of a 3G iPhone hitting the market this summer and new, more flexible pricing options are likely responsible for the rosier outlook.
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Apple (Nasdaq: AAPL) shares rose modestly Monday after an American Technology Research analyst raised his rating to "Buy" and an RBC Capital Markets analyst increased his price target for the computer and gadget maker's stock.
Apple shares rose US$3.57 to $184.51. Earlier, the shares traded as high as $185.31 -- their highest since early January.
In a client note, American Technology Research analyst Shaw Wu raised his rating to "Buy" from "Neutral" and set a $210 price target. The change came about two weeks after Wu, who has long been bullish on the stock, lowered his rating to "Neutral."
Taking a Longer View
Wu said Monday he overestimated the negative reaction on the fiscal second quarter and should have moderated his view instead of downgrading the stock a few weeks earlier.
"While Apple shares will likely remain volatile and we may see a better entry point from here, we need to align our rating with our longer-term view on fundamentals of the company," he says in the note.
In his Monday note, Wu says he still sees a "potential product vacuum and drawdown in inventory in the June quarter," but thinks this is fairly known and that investors will be more focused on products launching in the second half of the year.
3G iPhone Bonanza
Also Monday, RBC Capital Markets analyst Mike Abramsky raised his price target by $20 to $220 and reiterated his "Outperform" rating for Apple's stock.
"We see upside potential to iPhone estimates following changes, in our opinion, Apple may make to its iPhone business model, expected to accelerate momentum and expand its global addressable market," he said.
He thinks the company may be planning to allow subsidized pricing of the iPhone, to lower or drop the share of service revenue it takes from wireless carriers and to support global sales of unlocked iPhones.
The analyst also thinks the company is on track to release an iPhone in June that is compatible with 3G , or third-generation, wireless networks. Many analysts expect Apple to release such a product in the near future.
The analyst raised his calendar year 2008 and 2009 iPhone estimates, saying the company could "easily" surpass its goal of selling 10 million in 2008.
He also increased his fiscal 2008 and 2009 estimates for Apple.
shares rose modestly Monday after an American Technology Research analyst raised his rating to "Buy" and an RBC Capital Markets analyst increased his price target for the computer and gadget maker's stock.
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