Bernstein upgrades Apple stock, reiterates $195 target price

Bernstein analyst Toni Sacconaghi on Monday raised his rating on Apple stock to “Outperform” from “Market Perform” and reiterated his target price of $195.
Adam Clark for Barron’s:
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“The stock has derated significantly amid weak revenue growth, and investors worry that Apple’s China business is structurally impaired. We believe that Apple’s business prospects are largely unchanged…and believe the pullback provides an attractive entry point,” Sacconaghi wrote in a research note.
China has been the main culprit for weaker iPhone sales and the Bernstein analyst argues that is likely to be a cyclical issue rather than a structural problem… “In strong iPhone cycles, Apple’s China revenue typically grows much faster than Apple overall, as Chinese consumers embrace the new phone,” Sacconaghi wrote. “The strong embrace is typically followed by several quarters of weaker (and often negative year-over-year growth), as we are seeing now.”
That could be changed by the introduction of AI to the coming iPhone 16. That could help drive 10% growth in iPhone units shipped in fiscal 2025, and 10% growth in annual revenue for Apple overall, according to the Bernstein analyst.

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MacDailyNews Take: Hopefully, Apple’s marketing department can work its magic on Apple’s AI features this year to make them look as compelling, groundbreaking, and stunning as possible.
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