US housing starts have risen sharply and Chinese economic data has boosted market sentiment. Morgan Stanley is optimistic about 5G mobile phone demand and raised Apple’s target stock price. As of now, 5G is no longer an introductory topic. However, some companies like Apple are yet to unveil their first 5G smartphone. Nevertheless, analysts believe that 5G iPhone demand will be explosive. In response to the optimistic demand for the 5G iPhone, analyst Katy Huberty of Morgan Stanley raised Apple’s target price on Friday.
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Huberty also raised Apple’s target stock price from $ 296 to $ 368. “We increasingly believe that 5G will promote smartphone upgrades more than market expectations. This trend starts in 2020 and will further improve in 2021. We believe that the introduction of new 5G phones by top mobile phone manufacturers will stimulate investment by mobile operators and infrastructure manufacturers. This will further encourage manufacturers to launch new 5G phones and form a virtuous circle. “
Huberty raised its forecast for smartphone shipment growth in FY 2020 from 0.6% to 1.5%. She also raised her forecast for FY2021 growth from 1.8% to 3.5%. Analysts’ average expectations for these two periods are 1.5% and 2.4%.
Huberty also pointed out that her previous forecast of 203 million iPhones (an increase of 7%) in FY2021 was “conservative”. This is because it assumed that growth in the first half of 2021 will be below the normal upgrade cycle. She, therefore, raised her forecast for iPhone shipments in 2021 to 215 units, an increase of 13%. According to her, the average iPhone sales forecast for the fiscal year 2020 is $760. This is $15 adrift the former $745.