Jefferies Raises Apple Price Target Due to ‘Stable Trends’

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Jefferies analyst Peter Misek raised his price target on Apple (NASDAQ:AAPL) shares from $600 to $650 based on positive supplier news and “stable trends” seen in the firm’s quarterly survey on various mobile devices, reports Dividend.com. The analyst noted that Jefferies’ proprietary Apple Supplier Tracker found sales increases among Taiwanese suppliers that derive a significant amount of their sales from Apple.

According to Misek’s note to investors obtained by Dividend.com, Apple’s Taiwanese suppliers saw month-over-month increases of 12 percent and year-over-year increases of 8 percent in November. Misek also noted that companies that primarily make the iPhone 5S, such as Hon Hai Precision Industry, showed better results than companies like Pegatron that have more iPhone 5C exposure.

Misek maintained a “Buy” rating on Apple stock, and estimated 55 million iPhone sales and 25 million iPad sales for the December quarter. As noted by Dividend.com, the new $650 price target suggests a potential upside of about 17 percent from Friday’s closing price of $554.43. According to TheFlyontheWall, Misek also boosted his 2014 earnings estimate to $52.85 from $52.24.

The Jefferies analyst also adjusted his revenue estimates based on the impact of Apple’s upcoming iPhone distribution deal with China Mobile (NYSE:CHL). According to Dividend.com, Misek raised his March quarter revenue estimate from $45 billion to $45.6 billion. He also boosted his March quarter EPS estimate from $10.94 to $11.22.

Misek also offered several upcoming product predictions based on his supply chain sources. The Jefferies analyst noted that his supply chain checks indicated that Apple is moving its planned iPhone 6 launch from September 2014 to July /August 2014, reports TheFlyontheWall. Many industry watchers believe that Apple’s next iPhone iteration will feature a larger screen size. For example, China’s Ctech website recently reported that Apple has already started testing a 4.9-inch iPhone 6 prototype.

Misek’s sources also reported that the long-rumored iWatch is on schedule to be released in the first half of 2014. Misek isn’t the only analyst to hear rumors of an Apple wearable tech product launch in 2014. According to DisplaySearch analyst David Hsieh’s sources, Apple will release the iWatch in the fourth quarter of 2014. Finally, Misek also predicted the 13-inch iPad, also known as the “iPad Pro,” will be released in June 2014. The Korea Times reported similar rumors last month about an iPad with a 12.9-inch screen that would be released “early next year.”

Here’s how Apple has traded over the past five sessions.

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