Lynx Equity Strategies raised its price estimate for Apple (NASDAQ:) shares from $220 to $240 in a statement on Monday, saying there is “further growth potential.”
Despite the significant increase in the share price after the Worldwide Developers Conference, the investment firm believes that many investors have not yet fully recognized the stock’s true value.
“True value doesn’t come from great language models or impressive demonstrations. Apple’s value is instead found in a substantial and unique source of revenue that its major competitors cannot access,” Lynx added.
The company claims that, even after the recent and significant rise, the stock price has aligned with the S&P 500 index only in a year-over-year comparison.
“Apple’s value lies in its ability to personalize the AI experience for its more than two billion devices and more than one billion paying subscribers, using access to sensitive data stored on Apple devices and protected by regulations on Apple’s privacy policy,” Lynx clarifies.
From a financial perspective, analysts say Apple’s value lies in its proven ability to improve AI services “without incurring exorbitant capital expenditures.”
Additionally, analysts say the discussion shouldn’t be limited to whether the iPhone 16 will benefit from a new product introduction cycle. They are convinced that this will be the case, as the iPhone 16 introduces a new level of functionality.
“Artificial General Intelligence adds to a series of functional improvements that have occurred over the years – applications based on haptic interaction, 5G network support, improvements in camera technology – each of which has kicked off a multi-year cycle of device updates. After two years of modest iPhone sales growth, it is logical to expect strong demand from technology enthusiasts,” the company said.
“Based on past trends, analysts predict that the iPhone 16 will feature primarily Apple-developed artificial general intelligence applications,” they continue. “Analysts predict strong demand for the iPhone 16 from technology enthusiasts. Analysts also predict that next year, with the release of the iPhone 17, Artificial General Intelligence applications created by independent software vendors will be available, which should prompt another refresh cycle, this time appealing to the general consumer market and enterprise customers.”
The company concludes by saying that it expects Apple to incorporate Artificial General Intelligence capabilities into its computers, tablets and even smartwatches, with features progressively improving over time, thus encouraging users to upgrade their range of Apple devices.
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