Bank of America (BofA) has revised its price target for Apple Inc. (AAPL, Financial), lowering it from $250 to $240 while maintaining a Buy rating on the stock. This adjustment comes as the firm anticipates Apple to surpass revenue forecasts, boosted by an accelerated demand influenced by tariff concerns.
Despite these short-term expectations, BofA has revised its revenue projections downward for periods beyond the March and June quarters. This change reflects the anticipated higher costs associated with managing a more complex supply chain, and potential delays in rolling out a new AI-enabled version of Siri.
The firm remains optimistic about Apple's earnings per share (EPS), projecting a robust figure of $8.21 by calendar year 2026. However, BofA has adjusted for a lower multiple due to increasing uncertainties surrounding tariffs, which could impact future profitability.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 44 analysts, the average target price for Apple Inc (AAPL, Financial) is $236.44 with a high estimate of $300.00 and a low estimate of $141.00. The average target implies an upside of 15.56% from the current price of $204.60. More detailed estimate data can be found on the Apple Inc (AAPL) Forecast page.
Based on the consensus recommendation from 50 brokerage firms, Apple Inc's (AAPL, Financial) average brokerage recommendation is currently 2.1, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Apple Inc (AAPL, Financial) in one year is $206.17, suggesting a upside of 0.77% from the current price of $204.6. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Apple Inc (AAPL) Summary page.
AAPL Key Business Developments
Release Date: January 30, 2025
- Revenue: $124.3 billion, up 4% year over year, an all-time record.
- EPS: $2.40, up 10% year over year, an all-time record.
- iPhone Revenue: $69.1 billion, reaching all-time records in several markets.
- Mac Revenue: $9 billion, up 16% year over year.
- iPad Revenue: $8.1 billion, up 15% year over year.
- Wearables, Home, and Accessories Revenue: $11.7 billion, down 2% year over year.
- Services Revenue: $26.3 billion, up 14% year over year, an all-time record.
- Gross Margin: 46.9%, up 70 basis points sequentially.
- Net Income: $36.3 billion, an all-time record.
- Operating Cash Flow: $29.9 billion.
- Installed Base: Over 2.35 billion active devices, an all-time high.
- Capital Return: Over $30 billion returned to shareholders, including $23.3 billion in share repurchases.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Apple Inc (AAPL, Financial) reported an all-time high revenue of $124.3 billion for the December quarter, marking a 4% increase year over year.
- The company achieved all-time revenue records across multiple regions, including the Americas, Europe, Japan, and Asia Pacific, with strong momentum in emerging markets.
- Services revenue reached an all-time record of $26.3 billion, growing 14% year over year, with significant growth in both developed and emerging markets.
- Apple's installed base of active devices reached a new record of over 2.35 billion, driven by high customer satisfaction and loyalty.
- The introduction of Apple Intelligence features has been well-received, contributing to stronger iPhone sales in markets where it is available.
Negative Points
- Greater China revenue declined by 11% year over year, with over half of the decline attributed to changes in channel inventory.
- Wearables, Home, and Accessories revenue decreased by 2% year over year, facing challenges compared to the previous year's product launches.
- Foreign exchange headwinds are expected to negatively impact revenue by about 2.5 percentage points in the upcoming quarter.
- The company faces competitive pressures in China, where Apple Intelligence has not yet been rolled out, affecting iPhone replacement cycles.
- Operating expenses increased by 7% year over year, reaching $15.4 billion, which may impact future profitability if not managed effectively.
