Apple (AAPL) Gets New Analyst and $171 PT as RBC Capital Sees Wallet Not Car As Next Big Money Maker

February 8, 2021 1:19 AM EST
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Price: $133.09 -1%

Rating Summary:
    44 Buy, 19 Hold, 6 Sell

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Today's Overall Ratings:
    Up: 18 | Down: 8 | New: 31
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(Updated - February 8, 2021 6:59 AM EST)

RBC Capital analyst Mitch Steves assumed coverage on Apple (NASDAQ: AAPL) and raised the price target to $171.00 (from $154.00) on the belief that the Apple Wallet could be a much larger opportunity, near term, than an Apple Car.

The analyst stated "If the firm decides to enter into the crypto exchange business (multi-billion dollar industry), it could immediately gain market share and disrupt the industry (while simultaneously making the USA a leader in crypto for the next 10-20 years). To put some numbers around this, Square generates ~$1.6B/qtr in bitcoin related revenue on an active install base that we estimate to be in the ~30M range. Apple's install base is 1.5B and even if we assume only 200M users would transact, this is 6.66x larger than Square. Therefore, the potential revenue opportunity would be
in excess of $40B/year (15% incremental top-line opportunity). The best part? The R&D cost would be de minimis in our view as Square's entire R&D budget is under $1B. Net Net: fundamentals at Apple remain secure with a cash flowing business related to iPhones, Peripherals, Computers and Services. However, the firm could unlock a multi-billion dollar opportunity with a few clicks while investing into next generation chips as well."

No change to the Outperform rating.

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