Apple Inc AAPL is poised for a significant growth spurt, driven by its artificial intelligence capabilities, according to Gene Munster, a prominent tech analyst.
What Happened: Munster, the Managing Partner at Deepwater Asset Management, predicts that Apple’s AI features will significantly enhance the value of its devices, driving the company’s growth in the coming years. He believes that the AI-driven experiences will become indispensable for Apple customers, leading to a substantial revenue increase.
“This is just the start of Apple’s next growth chapter because these AI features make devices more valuable and powered in part by Apple’s unique data. These experiences will be a must have for Apple customers. The debate of when will AI inspired growth start for the company misses the point. If it’s late this year or sometime CY25, growth will return to the company,” Munster wrote in a post on X.
He anticipates a revenue growth of over 10% in CY25, compared to the current Street estimate of 6%, with a further increase to 12% in CY26.
Why It Matters: Apple’s AI advancements have been a subject of much discussion recently. Following the company’s Worldwide Developers Conference 2024, CNBC’s Jim Cramer expressed optimism about Apple’s future, particularly its new AI, Apple Intelligence, which is designed for personal use.
Moreover, a report from Cathie Wood‘s ARK Invest suggested that consumer adoption of AI will outpace previous technologies, such as smartphones and personal computers, potentially reaching 75% penetration by 2030.
Analysts have also noted that Apple’s plans to integrate AI features into its products, announced at the WWDC, could open the door for potential partnerships with other AI models, such as Google‘s Gemini or Anthropic.
Despite the positive outlook, some analysts have expressed mixed opinions about Apple’s future, particularly regarding the timing of the next iPhone upgrade cycle.
Price Action: Apple Inc. saw a significant surge on Tuesday, with its stock price rising by 7.26% to reach $207.15. After hours, the stock dipped slightly, marking a 0.29% decrease. Overall, Apple’s stock has experienced an impressive 11.59% increase year to date, according to data from Benzinga Pro.
Image Via Shutterstock
This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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