BofA Drops Apple Target to $200 on Macro and Supply Chain Headwinds

Image via Apple

20 MAY 2022 - News of a lowered price target on Apple shares, though not a lowered rating. On Thursday, Apple 3.0 ran part of a note from BofA analyst Wamsi Mohan. He still really likes Apple and the iPhone. He sees good times ahead for both. Better times, even. Among the positives listed:

1. Size of the global iPhone installed base was about 1.1bn units at the end of 2021

2. “The used iPhone installed base has been growing faster than the new iPhone installed base,” a trend Mohan expects to see continue

3. “A larger installed base can eventually drive higher consumption of services and sales of incremental devices (halo effect)”

4. “The iPhone installed base in China has been growing faster than other regions,” he expects that to continue

5. “Secondary market growth presents a large services opportunity.”

What’s not to love? Macroeconomic headwinds and supply chain headwinds. Those make the firm’s previous target of $215 too rich for Mohan. He’s kept his “Buy” rating on Apple shares but lowered his price target on the shares to $200.

I’ve gotta say, he’s left that target in a pretty respectable neighborhood considering Apple’s current stock price. Shares closed Thursday (19 May 2022) at $137.35. Mohan’s had been the street’s highest 12-month price target for Apple shares. That “honor” is split now between Evercore’s Amit Daryanani and Loop Capital’s Ananda Barauh. They’ve each got a $210 target on AAPL. “For those keeping score,” says Apple 3.0, “that’s $72.65 (35%) above Thursday’s closing price.”