Bullish Analyst Says Apple Has Potential to Become Trillion Dollar Company Within 18 Months

apple red logoApple has the potential to become a trillion dollar company by 2019, according to RBC Capital Markets analyst Amit Daryanani.

In a research note on Monday, Daryanani said Apple could reach or exceed a trillion dollar market cap within the next 12 to 18 months.

An excerpt from Daryanani's research note, edited slightly for clarity:

In aggregate, we see a scenario where in the 2019 fiscal year, Apple sustains $12+ earnings per share and, assuming the valuation frameworks remains stable/improves, it should get AAPL stock toward $192–$195, which would equate to a market cap above $1 trillion.

Daryanani believes the so-called "iPhone 8" and the upgrade supercycle it's expected to drive will be a major catalyst towards Apple's path to a trillion dollar valuation. Looking further ahead, he thinks there is potential for Apple to continue growing its Services category revenue by double digits year over year.

Longer-term, we think there is potential for Apple to continue growing Services revenue by double digit year-over-year given the company's expanding installed base [of devices], increasing App Store sales within the current installed base, demand for cloud storage/compute services, and further adoption of Apple Pay.

Apple's Services category brought in $7.17 billion last quarter, from $6 billion in the year-ago quarter, representing 18 percent year-over-year growth. Apple CEO Tim Cook said the Services category is already the size of a Fortune 100 company, with hopes to double the category's revenue by 2020.

Earlier this month, Apple's market cap surpassed the $800 billion mark for the first time ever as the company's shares traded above $153. RBC has raised its Apple stock price target to $168, up from $157, given the upside it anticipates from the iPhone 8 and increasing services-related revenue.

Wall Street analyst Brian White also raised his 12-month price target for Apple's stock to $202, up from $185, earlier this month. White believes Apple "remains among the most underappreciated stocks in the world," and his bullish price target suggests the company could be valued at a trillion dollars within the next year.

Top Rated Comments

Sunny1990 Avatar
46 months ago
Apple CEO Tim Cook said the Services category is already thesize of a Fortune 100 company, with hopes to double the category's "revenue" by 2020. :- Macrumors quote

Remember Once Former CEO of Apple Said :-

"I was worth about over a million dollars when I was 23 and over ten million dollars when I was 24, and over a hundred million dollars when I was 25 and... it wasn't that important — because I never did it for the money."

"Apple's goal isn't to make money. Our goal is to design and develop and bring to market good products.... We trust as a consequence of that, people will like them, and as another consequence, we'll make some money. But we're really clear about what our goals are."

Times have changed,seems like now it's more for the money,Well done Tim Cook
Score: 21 Votes (Like | Disagree)
WarHeadz Avatar
46 months ago

Apple will have to release more than just watch bands to make that happen.

Dude, honestly the watch band comments are getting really old and it doesn't sound as witty as you think it does. Apple has a lot of R&D going on right now in autonomous vehicles and health functions for the Apple Watch. I'm part of a research study right now on my Watch, they're collecting my heart rate data from the Cardiogram app in an effort to make the watch detect heart beat abnormalities, heart disease and cardiac arrest. And yeah, they release bands in pretty colors too. Your point?

Do some research and have some faith. Buy some stock and you may very well make a tidy profit from it. Or just miss out on it, up to you.
Score: 20 Votes (Like | Disagree)
btrach144 Avatar
46 months ago
Apple will have to release more than just watch bands to make that happen.
Score: 15 Votes (Like | Disagree)
djcerla Avatar
46 months ago

Apple CEO Tim Cook said the Services category is already thesize of a Fortune 100 company, with hopes to double thecategory's revenue by 2020. :- Macrumors quote

Times have changed,seems like now it's only for the money,Well done Tim Cook

Yeah, hiring 200 biomed PhD's and spending billions in research on a glucose-metering device surely corroborates your point. Only for the money.
Score: 11 Votes (Like | Disagree)
Bacillus Avatar
46 months ago

Dude, honestly the watch band comments are getting really old and it doesn't sound as witty as you think it does. Apple has a lot of R&D going on right now in autonomous vehicles and health functions for the Apple Watch. I'm part of a research study right now on my Watch, they're collecting my heart rate data from the Cardiogram app in an effort to make the watch detect heart beat abnormalities, heart disease and cardiac arrest. And yeah, they release bands in pretty colors too. Your point?

Do some research and have some faith. Buy some stock and you may very well make a tidy profit from it. Or just miss out on it, up to you.

Money has become their greatest enemy right now.
It has forced them into a defensive/incumbent position and stalled ambition to make new, revolutionary products. Thus alienated them from their original mission, which is exactly what SJ warned about.
Look at the latest iPad, a 4/5 years old design that denies every form of inspiration/innovation.
Disruptive innovation (launching new products, initially cannibalizing existing products)
has become the opposite of what they want: to keep marketshare, to remain leader, to not disturb current business. Move up the premium laddder, rebranding existing stuff as Pro (adding some gimmicks to justify price increases)
So superfluous budgets, massive R&D, but hardly any incentive to use them. Thousands of patents, but mostly defensive, keeping them unused to prevent the competion to innovate.
Leading to very few new products and designs.
What essentially drives Apple now is greed on a massive scale, requiring TC to save the humble image ("caring" for the impaired, pleading "accessibility", to distract public attention from inaccessibility due to increased prices)
Health: lots of incentives in the approach to conquer new markets. But difficult or impossible to get accreditation in medical world, which they grossly underestimated.
Same for autonomous vehicles: failed partnerships, difficult to innovate, absolutely no position to make an inroad in entirely new market. Huge investments to be written off already. Facial loss will prevent them from getting out. Lack of position/momentum will force them to buy themselves in somewhere. Only then, if any, the race begins.
iPhone will remain strong (it is and remains the cash cow) but it will take them utmost energy to stay current. And with all the attention going into paraphernalia activities, that will go at cost of the mid-segment (Mac, iPad, IT)
Innovation level remains incredibly low: companies of this mammoth size should bring 10/20 new products a year (compare with the car industry to realize what true competition would do)
The secret pact with Samsung (going to its limits supplying key technology on a mass scale, despite being "sued") impairs every form of an open smartphone marketplace currently.
Score: 9 Votes (Like | Disagree)
busyscott Avatar
46 months ago
I kinda hate that they are seeing this much love and bullish predictions in the marketplace. I'm sure they look at this as an indicator that they are making the right decisions, but based on my (albeit anecdotal) experiences and conversations, people are seriously concerned about the Mac line and that may have a bigger impact on phone purchases than Apple realizes.

What happens when the "Sheeple" that raved about Apple's superior products start jumping ship and singing a different tune?

I think the dedicated minority has a bigger influence on the quiet majority than Apple is comfortable admitting.
Score: 7 Votes (Like | Disagree)

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