Crispr Therapeutics shares tumble after significant earnings miss
On Wednesday, Evercore ISI, a prominent investment firm, maintained its Outperform rating and $260.00 price target on Apple Inc. (NASDAQ:AAPL), the $3.68 trillion market cap tech giant, following the announcement of the iPhone 16e. According to InvestingPro data, Apple is currently trading near its 52-week high of $260.10, with analysts’ targets ranging from $197 to $325. The new device, starting at $599, marks a significant price increase from the previous SE model’s $429 entry point. This shift in pricing strategy could indicate a new approach for future products, including the anticipated iPhone 17.
The iPhone 16e’s introduction has been well-received, specifically highlighting the advanced technical specifications and pricing strategy. With a robust gross profit margin of 46.5% and annual revenue of $395.8 billion, Evercore ISI believes that Apple’s decision to raise the price may serve as a potential test for setting higher entry prices on upcoming models.
Apple’s price hike for the iPhone 16e is the first since 2017, surpassing analyst expectations that anticipated a $499 starting price. The new pricing is considered a positive move for Apple’s profit and loss (P&L) and demonstrates the company’s technological leadership.
Another significant development is the unveiling of the Apple C1 modem chip. This new component is credited with contributing to the iPhone 16e’s extended battery life and is expected to be incorporated into the iPhone 17, potentially offering further improvements in battery performance and gross margin benefits.
The new iPhone is also expected to continue Apple’s successful track record in emerging markets, thanks to its compelling features and hardware offered at a relatively lower entry price compared to other premium models.
Evercore ISI projects that the iPhone 16e could generate approximately $14 billion in additional iPhone sales revenue. The firm also suggests that the combination of the price increase and the in-house modem chip could set a precedent for the upcoming iPhone 17 launch strategy. The maintained Outperform rating and $260 price target reflect confidence in Apple’s market position and financial prospects. InvestingPro analysis indicates that Apple currently trades at a premium to its Fair Value, with 22 analysts recently revising their earnings expectations downward. For deeper insights into Apple’s valuation and over 30 additional ProTips, consider accessing the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Apple has unveiled its iPhone 16e, featuring the company’s first custom-designed modem chip, the Apple C1, which marks a shift from reliance on Qualcomm (NASDAQ:QCOM)’s chips. The iPhone 16e is part of Apple’s strategy to offer advanced features at a lower price point, with the device priced at $599. It includes the A18 chip, a 48MP Fusion camera, and innovative satellite features such as Emergency SOS. This new model emphasizes durability and privacy, with a 6.1-inch Super Retina XDR display and extended battery life. In analyst updates, UBS maintained a Neutral rating on Apple, citing the anticipated launch of the fourth-generation iPhone SE, which will feature Apple’s first internally designed modem. Evercore ISI, on the other hand, upheld an Outperform rating, projecting that the new iPhone SE could significantly boost Apple’s revenue and earnings. The analysts noted that the iPhone SE’s enhancements and pricing strategy could attract consumers, especially in emerging markets. These developments indicate Apple’s ongoing efforts to innovate and expand its market presence.
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