Piper's Gene Munster Comfortable with 11% Unit Growth After Apple's (AAPL) Announcemnt

September 8, 2016 8:36 AM EDT
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Price: $116.60 -0.39%

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    62 Buy, 8 Hold, 5 Sell

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Piper Jaffray analyst, Gene Munster, reiterated his Overweight rating on shares of Apple (NASDAQ: AAPL) along with his price target of $151.

The analyst stated " we believe the device will be compelling enough to encourage enough consumers to upgrade to return the company to growth. We remain comfortable in our 11% y/y iPhone unit growth estimate for FY17 ("the iPhone 7 cycle") and believe this overall return to growth will encourage investors to return to the stock".

The analyst is modeling 164 million iPhone 7 units in FY17 which is 70% of the total 234 million iPhone unit shipments. One interesting wrinkle in his thesis is that he expects 10 million users to switch from Android to iPhone. Since Apple has 50% market share in highend smartphones, this implies that there are around 400-500 million high-end Android device users worldwide. If this is correct, the 10 million switching number would be about 2% of that base.

For an analyst ratings summary and ratings history on Apple click here. For more ratings news on Apple click here.

Shares of Apple closed at $108.36 yesterday.

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