Analysts Boost Apple (AAPL) Shares Higher on Valuation and iPad 3

This is the fourth day in a row of the morning selloff followed by dip buyers coming in.  It has become so old hat, I just saw Fonzi jump over a shark.

Leading the charge today is bad boy Apple (NASDAQ:AAPL) surging some 4%.  News of a March release of the iPad 3, and analyst upgrades has it sizzling.  Like the NASDAQ as a whole, Apple is extremely overbought with a RSI now in the mid 85s.  But until we actually see selling that holds, everything remains in teflon mode.  It is quite remarkable to see a nearly $500B company move like this; reminds me of Cisco (NASDAQ:CSCO) circa 1999.

Canaccord Genuity boosted its price target on Apple to $665.

From Canaccord:

Our January checks indicated iPhone 4S was the top-selling model at AT&T, Sprint, and Verizon, and we anticipate strong March quarter iPhone sales in international markets including China. As a result, we are increasing our March quarter iPhone unit estimate from 30.1M to 32.6M units.

Needham & Co. is also awfully bullish, boosting its price target this morning from $540 to $620 due to the ability of Apple’s sales “to grow at an unprecedented rate for a company so large.” Here’s Needham’s take:

Since our previous valuation report, the most important changes in the competitive landscape have occurred in the media tablet market. With the introduction of the Amazon Kindle Fire and other low-priced tablets, tablet sales have grown at a much faster pace than we previously forecast. From the iPad’s perspective, the device has launched a massive attack on the business market prompting us to materially increase our forecast of iPad sales as well. Courtesy of the halo effect, the increase in our forecast of iPad sales has, in turn, translated into an increase in our forecast of Mac sales, which is also invading the business market.

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Any securities mentioned on this page are not held by the author in his personal portfolio. Securities mentioned may or may not be held by the author in the mutual fund he manages, the Paladin Long Short Fund (PALFX). Trader Mark also authors the blog Market Montage.

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