Goldman Sachs is turning bullish on Apple. The world's second-largest investment bank initiated a ‘Buy’ rating on the maker of iPhones, iPads, and Mac computers.
Goldman set a 12-month target price of $199 per share, suggesting a possible gain of more than 33%.
Analyst Michal Ng said, "Apple’s installed base growth, secular growth in services, and new product innovation should more than offset cyclical headwinds to product revenue, such as reduced demand in the iPhone, PC, and tablet categories,"
"The market’s focus on slower product revenue growth masks the strength of Apple’s ecosystem and associated revenue," he added.
Apple revenue fell 5% to $117.2 billion in the fiscal first quarter ended Dec. 31, 2022, though the company set an all-time revenue record of $20.8 billion in its services business.
Net income fell to $30 billion from $34.6 billion.
Apple shares have more than tripled since the last time Goldman had a buy-equivalent recommendation on Apple in 2017.
Meanwhile, risks to the bank’s prediction include weakening consumer demand, supply chain disruption, intensified competition, regulatory hazards and capital allocation execution.
