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As Wall Street predicts, the upcoming 2021 will be fruitful for Apple. Analysts expect the company’s revenue to increase to 15% in fiscal 2021 from 6% in 2020. Further, and profit growth is projected to double to 20%.
Apple‘s excellent performance has brought Apple Inc (NASDAQ: AAPL) stock to a new intraday record on Tuesday as 2021 is coming. It rose as much as 1.5% to $138.79 before closing the day at $134.87 with a 1.33% decline. So far in December, Apple shares have gained 13%, which brings the giant to the leadership among top tech stocks. With an 84% rally, Apple surpassed Amazon.com Inc (NASDAQ: AMZN) stock that increased by 80%.
Apple’s rally results from strong demand for iPhone 12 as well as optimistic expectations about the company’s development of the electric vehicle. According to Apple analyst Ming-Chi Kuo, Apple Car will arrive no earlier than 2025-2027. However, the company’s revelation about working on EV has itself brought Apple stock higher and led it to a new record.
The specifications for the vehicle are not yet clear but some details about the car are already known. The vehicle will have a unique “monocell” battery design. As a result, a longer range per charge will be available. Besides, Apple will focus more not on tech features but on software. In particular, the car will have a reliable auto-pilot with “speaking” AI.
Bullish 2021 Predictions for Apple
As Wall Street predicts, the upcoming 2021 will be fruitful for Apple. Analysts expect the company’s revenue to increase to 15% in fiscal 2021 from 6% in 2020. Further, and profit growth is projected to double to 20%. Some also believe Apple will be the best player among FAANG stocks.
Gene Munster, the managing partner at Loup Ventures, stated:
“Our headline prediction is that Apple will be the top-performing FAANG stock in 2021. […] We believe shares of AAPL will approach $200 (46% upside from current levels) over the next couple years, based on 35x our 2022 EPS estimate of $5.70.”
According to Loup Ventures’ blog post, there are several factors that will stimulate Apple’s rally. Firstly, accelerating digital transformation will move Apple forward. With a combination of hardware, software, and services that its competitors cannot match in terms of reach or popularity, Apple will be the cornerstone of this digital transformation.
Secondly, Apple will enjoy its biggest smartphone upgrade cycle since iPhone 6 due to the 5G network. As Loup Ventures said, they expect limited 5G network coverage in the US will initially temper consumer demand for iPhone 5G in the front half of 2021, as 5G coverage and performance improves in the back half of the year.
In addition, Apple is expanding its activity with new business segments, which will not go unnoticed. For now, it is too early to say what role Apple will play in the future of automotive and broader transportation. However, it is clear the company is well-positioned to meaningfully contribute to creating the car of the future, given their differentiated technology in silicon, software, batteries, AI, and cameras.