5G iPhones and work-from-home trends may drive share price

Members of the media take photos of the iPhone 11, iPhone11 Pro and iPhone 11 Pro Max smartphones at the Apple Marunouchi store in Tokyo, Japan on September 20, 2019.

Tomohiro Ohsumi / Getty Images

According to one analyst, Apple’s likely plans are to release 5G-supported phones as well as remote work and online learning trends.

The iPhone-maker recently became the first publicly traded US company to reach the $ 2 trillion market cap, almost two years after reaching the $ 1 trillion milestone. Apple’s stock climbed 1.2% on Monday.

DA Davidson managing director and senior research analyst Tom Forte said, “The notable thing in my opinion is that Apple achieved a $ 5 trillion market cap without selling a single 5G iPhone.”

He added, “To the extent that during many years of positive development of the 5G iPhone for smartphones, Apple’s stock performance may continue.”

5G refers to the fifth generation of high-speed mobile Internet that aims to provide faster data speeds and greater bandwidth to carry increased levels of web traffic.

Currently Apple is the third largest smartphone manufacturer by shipment behind Huawei and Samsung. A report by the Nikkei Asian Review states that the American tech giant is set to release four models in its 5G lineup with three different screen sizes. The report also stated that Apple is experiencing delays between four weeks to two months for mass production.

Distance Work and Online Learning

Due to the coronavirus epidemic, more people are now working remotely and have taken to learning online.

Fort cited the calculation by Logitech, which said last month that an estimated one billion people were now working from home.

“So, on that basis what you’ve seen is the strength of the tablet, the strength in the laptop, for Apple, apart from the strong iPhone sales. To the extent that consumers continue to work and learn from afar, I think That we will see more strength. In tablets and laptops, “Forte added.

In July, Apple reported a historically strong third quarter with double-digit growth in its products and services sectors. Despite widespread retail closures during the quarter due to the epidemic, Apple said its overall operations were boosted by work-from-home trends and online sales.

Fort said Apple’s exposure to China, where iPhone sales rose sharply in the June quarter, could pose a “significant risk” amid ongoing tensions between Washington and Beijing.

Share split and price target

The company also announced a 4-for-1 stock split, where for each share of Apple stock that an investor owns, they would receive three additional shares. This makes it more affordable for investors to buy Apple’s single shares.

Fort said that there is a chance that shares will continue to climb as a result of the split. DA Davidson previously raised its price target to $ 480 from $ 355 per share. Apple currently trades above $ 500 and Forte said the firm’s price target is now under review.

Morgan Stanley raised its price target for Apple shares from $ 431 to $ 520 in a separate note on Sunday. The investment bank said it expects continued services growth and a 5G iPhone cycle to increase double-digit revenue in FY 2021 in its base case assumptions.


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