How Apple stock can break through the $200 barrier

Apple shares hit a new all-time intraday high on Thursday and are hovering just below $200. There are three reasons to think Apple can break through the barrier, Adam Clark writes for Barron’s.
Adam Clark for Barron’s:
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Stockholders looking for it to break higher should be confident despite its recent run of four quarters of declining year-over-year revenue, according to Citi’s analysts.
“We believe the bears on the stock are missing the structural gross margin expansion story driven by iPhone premiumization, acceleration in services sales, and the silicon insourcing benefit… We expect the above trends to continue next year, and view AI Phones and Vision Pro adoption as potential upside catalysts,” Citi analyst Atif Malik wrote in a research note.
Malik has a Buy rating and $230 target price on Apple stock.
While much of the debate around Apple stock revolves around its hardware, Malik argued services are still providing a growth engine and look set to keep growing as a source of revenue in 2024. “With an increasing installed base and penetration/attach rate, we believe Apple Care, iCloud and other licensing services will be the fastest growing services segments, reaching about 45% of the total services revenue in FY2025 and driving upside to Street’s overall gross margins,” Malik wrote…
In addition to AI-enabled phones, Apple also has another long-term potential catalyst in its Vision Pro headset.
Analysts at UBS suggested that at a price point of $3,499 the first generation of the device could generate around $1.4 billion of revenue in fiscal 2024, rising to $3.2 billion in fiscal 2025.

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MacDailyNews Take: Additionally, Wedbush analyst Dan Ives wrote in a research note on Thursday, “Apple doesn’t appear to have meaningfully shifted iPhone 15 2023 builds since it started shipping devices despite concerns that Chinese consumers are shifting towards Huawei or that macro issues might be weighing on iPhone demand.” Ives has a $250 target price on Apple stock and an Outperform rating.
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