The Zhitong Finance App learned that on Thursday, the US tech giant$Apple (AAPL.US)$Continuing to attack the $3 trillion market capitalization mark, Wall Street bank Citibank said that Wall Street investment institutions have generally underestimated the extent of the tech giant's gross margin expansion. Citiv analyst Atif Malik began covering Apple with a “buy” rating. He pointed out that Apple continues to seize market share from Android smartphones, and that Apple's profit margin continues to expand due to the higher proportion of iPhone Pro and iPhone Pro Max models.
Malik added that Apple's overall gross margin is also driven by the continued expansion of market share in China and India, and continues to cut costs by designing its own brand of chips and strengthening service businesses. Furthermore, the analyst also set Apple's target stock price at the high expectation of $240.
Malik also pointed out that although the recently released Apple Vision Pro is unlikely to be the main driver of recent Apple sales, he is focusing on “how this product can be integrated into everyday life and the possibility of benefiting from the global wave of artificial intelligence.”
On Thursday, Apple's stock price closed at $189.59, up nearly 0.2%. At one point, the intraday price rose to an all-time high of $190.070. By the close of the US stock market on Thursday, Apple's market capitalization reached 2.98 trillion US dollars, which is only one step away from the 3 trillion US dollar market capitalization mark.
Before Citibank covered Apple with a “buy” rating and high expectations of $240, another major Wall Street bank, Wedbush, gave Apple an “outperform the market” rating, and set the target price at $220. Wedbush is also very optimistic about Apple's service business. It is estimated that Apple's service business revenue this year is expected to be close to 100 billion US dollars, compared to only 50 billion US dollars in 2020. Wedbush also said that Apple's reasonable valuation may be around 3.5 trillion US dollars. Under optimistic circumstances, it is estimated that by fiscal year 2025, Apple's valuation may reach 4 trillion US dollars.
In terms of iPhone sales expectations, Wedbush said Wall Street “seriously underestimated” iPhone upgrade opportunities because the upcoming iPhone 15 may enter a “mini super cycle.” About 25% of iPhone users haven't upgraded their iPhones in the past four years, and the potential demand for a switch is quite high.