A Wall Street analyst on Monday listed five reasons why Apple stock has more gas left in its tank for 2020. Chief among those is the 5G wireless upgrade cycle, which should drive iPhone sales for the next two years, he said.
XD.A. Davidson analyst Tom Forte reiterated his buy rating on Apple (AAPL) and raised his price target to 375 from 300. On the stock market today, Apple stock rose 2.1% to 316.96. Intraday, it notched a record high of 317.07.
Forte believes Apple will increase its iPhone unit sales with its 5G handset launches in fall 2020 and fall 2021.
On a related note, he thinks wireless carriers will be motivated to use incentives to get subscribers to upgrade to the faster new networks.
Apple Stock To Benefit From Wireless Carrier Incentives
"Apple should benefit from wireless carriers' desire to earn returns on their significant investment spending for infrastructure and spectrum to make 5G a reality," Forte said in a note to clients. "As a result, they may be offering greater incentives to consumers to upgrade their devices to leverage their 5G networks."
In addition to those two 5G-related catalysts, Apple stock could get a boost from share buybacks, the Apple Card credit card and other emerging businesses.
Apple ended the September quarter with $79 billion remaining on its current Apple stock repurchase authorization. Look for the company to update its annual plan to return capital to shareholders in April or May, Forte said.
Meanwhile, Apple Card is part of Apple's burgeoning services business. Other services offerings include AppleCare, iCloud, Apple Music, Apple TV+ and Apple Arcade.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor companies.
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