Canaccord Genuity analyst Michael Walkey reiterated his “buy” recommendation on Apple (NASDAQ:AAPL) shares Wednesday, and upped his 12-month price target to $580.
According to CNET, the analyst wrote the upbeat note to investors mid-week, and he supported his assertion with the data that Apple is currently selling its iPhone 5S and iPhone 5C at a rate of 2.5-to-1, which is good news for the tech giant as the 5S is considerably more expensive than the 5C, and thus generates Apple more revenue. Walkley also believes that this trend will continue into the holiday season as more consumers put the iPhone devices on their Christmas wish lists, and he pegs Apple’s last-quarter iPhone sales at 52.5 million.
China Mobile’s shipment of the iPhone early next year is also expected to especially bolster Apple’s business in 2014′s first quarter because the phone giant currently serves more than 750 million subscribers, and Apple deliberately launched its low-price iPhone C to better appeal to many of those cost-conscious customers. Walkley estimates that China Mobile’s business could add over 10 million iPhone unit sales to Apple’s financials, and that could continue if its introduction into the new market goes successfully.
In addition to the popular new iPhones, the analyst also expects iPad sales to account for significant Apple revenue in the fourth quarter, especially because he believes the Cupertino, California-based company will announce a major iPad 5 design at its special event next Tuesday. Rumors over updates to the iPad line have swirled for months now, but if those of a new iPad 5 and iPad Mini with Retina display ring true, Walkley believes they’ll drive tablet sales.
He is especially confident in the imminence of an iPad 5 launch, because he still cites indecision for when he thinks the iPad Mini will eventually hit shelves, but Walkley wrote to investors Wednesday via CNET, “We are modeling iPad 5 and iPad Mini units at 12.9M/11.5M for the December quarter. We anticipate this sales mix will reverse to 8.4M/14.4M in the March quarter driven by the delayed launch of a refreshed iPad Mini with Retina display and increased iPad Mini demand from international markets, particularly in China around Chinese New Year.”
Thus, if not next week, the analyst is confident that the iPad Mini will be unveiled soon, and he also expects Apple’s smartwatch and television to roll out sometime in the 2015 fiscal year.