Morgan Stanley Hikes AAC Technologies Estimates On Apple Expectations

MorganStanley raised its estimates on Aac Technologies Holdings Inc (HKG:2018) to a $65.00 price target based on Apple Inc. AAPL expectations. Aac Technologies shift from single to multiple drivers is being viewed as a "fruit bearer" in 2016, according to MorganStanley's research report released on Thursday. "We expect AAC to benefit from dollar content upgrade for most if not all key products, enabling it to outgrow peers in a slowing industry. Visible growth, ROE uptrend and reduced single product risk should warrant re-rating," MorganStanley analysts commented in the note. Investors shouldn't be too worried. iPhone's sell-through had improved in November. MorganStanley believes that the Street is "overly concerned" about Apple's iPhone 6 sell-through risk, however they are overlooking the upside potential from dollar content increase across almost all major products. MorganStanley also noted that AAC's early-mover advantage and self-designed equipment ensures its share for new haptics designs in the next generation iPhone. For investors, AAC is a fast growing stock. The outlook for Aac Technologies Holdings is looking good. The company experienced an EPS growth of 49.6 percent last year, Its current growth estimate for this year calls for an earnings-per-share growth of 16.6 percent. MorganStanley expects AAC's visible growth to be fueled by rising dollar content next year. The company's dynamic components are poised to deliver 113 percent, 19 percent and 14 percent YoY sales growth in 2016.