Apple Remains A Strong Buy As iPad, iMac Demand Picks Up, Says Analyst

For Apple Inc. AAPL investors, the name of the game in the closing weeks of 2017 is figuring out just how much demand there is for the iPhone X. Unfortunately, with the devices in short supply, judging the market is easier said than done. One Wall Street analyst is optimistic about 2018.

The Analyst

Tigress Financial analyst Ivan Feinseth reiterated a Strong Buy rating for Apple.

The Thesis

Demand for the newest models of all of Apple’s devices, including iPhones, iPads and iMacs, is picking up. While the iPhone remains the company’s cash cow, it's already working on its next generation of products by developing artificial and augmented/virtual reality technology, Feinseth said. (See Feinseth's track record here.) 

In addition, Apple plans on being a major player in autonomous vehicle software, the analyst said. 

Apple may be approaching the smartphone saturation point in the U.S., but Feinseth said it still has plenty of room for growth in emerging markets such as China and India. With the Republican tax reform plan seemingly on the brink of passage, Apple will soon have a massive cash stockpile at its disposal for potential investments and/or capital returns, Feinseth said. 

“We believe [the] newly passed tax bill, when finalized, will enable the repatriation of a significant portion of AAPL’s excess cash, enabling it to pay a combination of a one-time dividend [and] additional share repurchase announcement,” the analyst said. 

Price Action

Tech stocks have been hit hard in the past week as investors take profits on large 2017 gains. Apple is down 2.4 percent in the past five trading sessions but remains up 47 percent year-to-date.

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Photo courtesy of Apple.