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UBS Latest Firm to Ratchet Up Apple (AAPL) Price Target; Forget the new iPad, the iPhone 5 Will Be Biggest in History

March 16, 2012 8:19 AM EDT Send to a Friend
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Price: $100.96 -0.82%

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UBS is the latest Wall Street firm to boost its price target on the venerable Apple (Nasdaq: AAPL).

Analyst Maynard Um cranked up his target from $550 to $675 and raised FY13 estimates, saying he expects the iPhone 5 to be the biggest catalyst & launch in Apple's history.

Um raised FY13 rev/EPS estimates to $180.1b/$50.43 from $175.8b/$48.83.

"We expect Apple to launch its redesigned iPhone 5 in October & expect the company to accelerate the number of initial carriers it sells into to drive its biggest launch ever," Um states. "Although supply chain constraints are difficult to assess at this point, we expect Apple to be prepared for a big launch. While the iPad 3 reception & dividend are important, we believe the iPhone 5 will trump both as a catalyst."

The analyst also notes that a account-based billing by US carriers is a positive for Apple. He notes Verizon (NYSE: VZ) has suggested it will phase in account-based billing this summer, which will allow a customer to pay for one data plan but share it across multiple devices. "We believe this could help mix shift more toward higher priced/margin LTEenabled iPads," the comments. "Near-term, we believe display constraints are limiting new iPad units but remain comfortable with our 12mn est due to iPad 2 builds."

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