Two pros explain why Apple stock has more upside potential

By: Ruchi Gupta
Ruchi Gupta
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on Jul 15, 2021
  • Jim Suva sees Apple revenue and sales accelerating in 2H 2021
  • Accelerating growth will justify AAPL stock moving higher
  • Tech pro Gene Munster believes AAPL is worth $200 and ranks as the best FAANG stock

According to two market analysts, Apple Inc. (NASDAQ: AAPL) could witness an encouraging second half of 2021 have as shares of the tech giant continues to soar. For the third time this week, Apple shares hit record highs on Wednesday, following reports that the consumer tech company had instructed suppliers to increase iPhone production. Shares closed at $149.15 per share on Wednesday.

Apple’s valuation is unlikely to expand, but there is much upside

Citigroup senior tech analyst Jim Suva thinks Apple’s valuation is generally fair and unlikely to expand. Suva told CNBC:

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“We do not, unfortunately, expect the valuation to expand. What we do see accelerating is the revenue and sales upside, and that’s why consensus is too low. And with that, we think the upside in the stock’s going to be from the fundamentals of sales and earnings and cash flow and not from the market revaluing this higher-on-a-multiple perspective.”

On the other hand, Loup Ventures co-founder and managing partner Gene Munster expects significant upside to be seen. He explained that the belief among investors is that the March quarter was the best quarter for the company in almost a decade since he started following Apple.  Munster said that the best days for the company are coming considering what Apple is doing in healthcare, transportation, 5G augmented reality, and other services. 

Munster: AAPL is the best FAANG stock

According to Munster, all the company is doing could play well and boost earnings, with Wall Street projecting $5.50 in 2022. When put together, the number could be closer to $6, and he thinks AAPL is a $200 stock, which is an upside of 40%. Munster said:

“I do want to point out I’ve been bullish on apple for a long time. I made a prediction this year. That apple would be the top performing tech doc. And that’s probably not going to happen. Google is up 44%. Apple is up 9%, but if I set aside, that, prediction, which probably isn’t going to happen, I believe that apple is going to be the top performing thing in the back half of the year, because ultimately I think it can get a lot better. And I think that this company is best position of all FAANG.”

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