Could Apple stock jump 30%? This Nvidia AI bet may hold the key

Apple stock NASDAQ:AAPL could have roughly 31% upside after Rothschild & Co Redburn upgraded the shares to Buy from Neutral and raised its price target to $400 from $260.

Rothschild & Co Redburn upgraded Apple to Buy from Neutral and lifted its price target to $400 from $260.

Analysts led by Timm Schulze-Melander argue that Apple could strengthen its AI position by relying on open models, potentially including technology from Nvidia.

There is no announced Apple-Nvidia AI partnership. Redburn is outlining a strategic option, not describing an existing deal.

Apple’s $400 case starts with a different AI strategy

Redburn’s thesis begins with an uncomfortable assessment: Apple Intelligence has disappointed, while Apple’s foundation models remain behind the frontier.

Apple has already turned to Google’s Gemini models for its AI strategy. Redburn argues that Apple could go further by adopting what it calls a “Fast Follower 2.0” approach, using strong third-party models rather than spending billions trying to build the industry’s best model.

That is where Nvidia enters the picture.

Schulze-Melander wrote, according to MarketWatch, that “a close, favourable partnership requires both Apple and Nvidia to want it.”

Redburn highlighted Nvidia’s Nemotron models as an example of open technology that could reduce Apple’s dependence on Google while preserving more strategic flexibility.

The underlying idea is that Apple’s advantage may be distribution.

With billions of active devices, it could become the gateway through which consumers use leading AI models even if those models are built elsewhere.

Nvidia could offer Apple a shortcut back into AI

The appeal of an Nvidia or open-model route is clear.

Google gives Apple access to advanced AI quickly, but it also increases reliance on a company that competes with Apple across smartphones, operating systems and services.

Open models could let Apple retain greater control over the user experience while choosing among outside technologies.

HSBC has made a similar broader argument about Apple’s restraint. Analyst Nicolas Cote-Colisson upgraded Apple to Buy in July and raised his target to $366, arguing that the company’s relatively modest AI spending could prove an advantage as its capabilities and product pipeline improve.

That reframes Apple’s perceived weakness.

Instead of trying to match hyperscalers dollar for dollar, Apple could spend less on model development and concentrate on integrating AI into devices, software and services.

If model performance becomes increasingly commoditised, owning the consumer relationship could become more valuable than owning the underlying model.

The 30% upside still carries major risks

Redburn’s $400 target is not simply an Nvidia call.

The firm also expects Apple’s anticipated foldable iPhone to provide a major lift, forecasting 14 million iPhone Ultra units in fiscal 2027 at an estimated $2,199 price. Redburn believes the device could raise iPhone average selling prices materially.

That assumption remains contested. Jefferies analyst Edison Lee downgraded Apple to Underperform on August 10 and cut his target to $263.66.

Jefferies cited concerns about Apple’s premium-device roadmap and limited progress in Apple Intelligence, while warning that an expensive foldable could remain a niche product.

The contrast captures the debate around Apple today.

Redburn sees an opportunity for Apple to avoid the most expensive part of the AI race and instead become its distribution layer. Jefferies sees execution risks in both AI and premium hardware.