Apple’s (NASDAQ:AAPL) stock continued to climb on Thursday following the company’s confirmation of its deal to acquire Beats Electronics on Wednesday. While some analysts boosted their price targets before the acquisition deal was confirmed, other analysts are now racing to raise their underwater price targets. Apple’s press release revealed that the iPhone maker will acquire Beats for a total of $3 billion, including approximately $400 million that will vest over time. Beats co-founders Jimmy Iovine and Dr. Dre will also join Apple as part of the deal. Additional comments made by CEO Tim Cook in an interview with The New York Times suggested that the Beats co-founders were a crucial component of the deal and will play a key role in shaping Apple’s music content strategy. “These guys are really unique,” Cook told The New York Times.
Now that Apple has laid its acquisition cards on the table, several prominent analysts have boosted their price targets for the iPhone maker’s shares. First up is Piper Jaffray analyst Gene Munster, who boosted his price target on Apple shares to $732 from $640 in a note released on Wednesday. However, Munster cited the timing of upcoming product releases as the reasoning behind his Apple price target increase, rather than the recently confirmed Beats deal. It’s unclear if Munster has changed is original negative opinion of the Apple-Beats deal, although he remains bullish on Apple. Soon after the rumors of the acquisition first emerged earlier this month, Munster called it a “bad idea,” despite noting that Iovine would likely be an important asset for Apple’s overall content strategy.
UBS analyst Steven Milunovich is another analyst that recently boosted his price target on Apple shares. In a note to investors obtained by Apple Insider, Milunovich raised his price target on Apple to $700 from $625. In a note issued earlier this month, Milunovich took a positive perspective on the rumored Beats acquisition and presciently noted that Apple was likely looking to “complement its mediocre success with iTunes Radio,” reports Barron’s.