Morgan Stanley Upgrades Apple (AAPL) to Overweight, Citing iPhone Strength

May 26, 2009 7:19 AM EDT
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Morgan Stanley upgrades Apple (Nasdaq: AAPL) from Equal Weight to Overweight, saying iPhone sales will drive better-than-expected earnings the next two years.

The firm said, "the market is underestimaing iPhone unit demand." The firm also expects Apple to cut the price for the current model, and lifted its 2009 iPhone sales forecast 42% to 24.8 million and its 2010 iPhone sales estimates were lifted 61% to 36.2 milion.

The firm raised 2010 earnings estimates from $5.52 per share to $7.50 per share.

The price target on Apple was lifted to $180.

UPDATE: Click here to see more color on the upgrade.

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