Apple Inc. (NASDAQ:AAPL) stock soared to a new 52-week high on Tuesday, closing at $242.65, despite a general market slowdown. Wedbush's Dan Ives reacted to it, reiterating his belief that the iPhone 16 is the "start of a super cycle."

What Happened: AAPL stock rose by 1.3% on Tuesday, pulling up the broader Nasdaq Composite index. This also represented Apple's best three-day performance since Oct. 10, when it gained 3.3%.

This comes at a time when reports have pointed to iPhone sales lagging amid a lukewarm reception to new AI features. According to market research firm IDC, Apple's iPhones are expected to see a moderate 0.4% year-on-year growth in 2024, while the broader industry is expected to grow at 6.2%.

Ives, who has been bullish on Apple's prospects as far as the AI uptake is concerned, explained that the skepticism about Cupertino's potential is exaggerated.

"The Street is starting to realize the iPhone 16 is the start to a super cycle and China sales look robust, sending the bears into hibernation mode," Ives told Barron's in an interview.

IDC's forecast states that AI-powered smartphones will dominate sales by 2028, accounting for 70% of the total market. Ives believes Apple Intelligence-equipped iPhone 16 will help Apple post 90 million unit sales in 2025, and noted that it will help Apple hit $4 trillion in market capitalization in the coming year.

Why It Matters: Apple's recent stock performance is bolstered by several key developments. A report from BofA Securities highlights a 15.2% increase in App Store revenues in the first quarter of FY25, driven by a multi-year iPhone upgrade cycle and strong service expansion.

Additionally, Ray Dalio's Bridgewater Associates has increased its stake in Apple, indicating confidence in the company's future prospects. The hedge fund's decision to buy more Apple shares while reducing stakes in other tech giants underscores Apple's perceived stability and growth potential.

Moreover, Apple's strategic plans to launch a foldable iPhone by 2026 could rejuvenate the smartphone market, potentially leading to significant market share gains.

Price Action: Apple stock closed at $242.65 on Tuesday, ending the day higher by 1.3%. Year-to-date, the company's stock is up 30.7%, according to Benzinga Pro data.

Overall, analysts have a consensus rating of "Buy" on Apple stock, with the highest price target being $300. The most recent analyst ratings by Wedbush, Morgan Stanley, and Maxim Group have an average price target of $262.67, implying an 8.3% downside.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Photo courtesy: Apple