Apple (NASDAQ: AAPL) is the most valuable company in the world right now with a market capitalization of almost $3.3 trillion, but shares of the tech giant have underperformed some of the other big technology names so far this year.
Apple, along with Amazon, Nvidia, Microsoft, Alphabet, Meta Platforms, and Tesla, are the seven biggest technology-focused companies that have played a central role in driving the stock market’s rally in the past year and a half. They are collectively known as the “Magnificent Seven.” It is worth noting that some of them, such as Nvidia, Meta, and Alphabet, have delivered stronger gains than the market in 2024.
However, it won’t be surprising to see Apple stock stepping on the gas in the closing stages of 2024 and eventually getting to the $4 trillion market cap milestone, which is 21% away from its current valuation.
AI is likely to lift Apple’s sales
Apple has yet to introduce artificial intelligence (AI)-enabled smartphones as compared to rivals such as Samsung and other Chinese original equipment manufacturers that have already jumped on this bandwagon. However, that is likely to change next month when the company launches its next generation of iPhones, which are set to support the company’s generative AI suite of features known as Apple Intelligence.
The tech giant introduced Apple Intelligence in June this year, pointing out that this platform will be “deeply integrated into iOS 18, iPadOS 18, and macOS Sequoia.” Apple Intelligence has a host of generative AI features that could trigger a new upgrade cycle, encouraging users on older devices to upgrade to the latest iPhones.
J.P. Morgan analyst Samik Chatterjee believes that the next iPhone will kick off a new upgrade cycle that will last beyond Apple’s 2025 iPhone generation. More specifically, the analyst estimates that Apple could see a 10% increase in iPhone unit sales in fiscal 2025 to 244 million units. Apple’s fiscal 2025 will begin late next month and coincide with the launch of its AI-enabled iPhones.
J.P. Morgan sees iPhone sales rising to 268 million units in fiscal…
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