3 reasons why investors should remain bullish on Apple stock – Needham
Needham & Company analysts have outlined three compelling reasons for investors to maintain a bullish outlook on Apple stock, even amidst concerns about the company’s reliance on the iPhone. These analysts believe that Apple’s strong “stable and liquid” fundamentals, huge share repurchase program, and the company’s strong cash position provide a solid foundation for continued growth and success.
Sam Boughedda for Investing.com:
The analysts note that while competitors like Amazon, Google, Microsoft, and Meta are heavily investing in generative AI (GenAI) infrastructure with no immediate revenue boost, Apple stands out as a stable and liquid stock.
Needham says Apple is actively reducing its equity base through share buybacks, which is expected to drive earnings per share (EPS) growth. The company’s $110 billion share repurchase authorization from May 2024 is projected to lead to 11% EPS growth in fiscal year 2025 and 12% in 2026, according to Needham estimates.
Needham believes Apple’s commitment to achieving “net cash zero” from its current net cash position of about $50 billion, along with $91 billion in cash from operations reported in the first nine months of fiscal year 2024, suggests accelerated share repurchases in the near future.
MacDailyNews Note: Needham maintains a Buy rating on Apple with a target price of $260 per share, an upside of some 16% over the current price.
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