Apple Inc. (NASDAQ:AAPL) upward momentum seems to have cooled off after testing all-time highs much to the concerns of investors but not Piper Jaffray Senior analyst, Gene Munster. During an interview on CNBC, Munster reiterated that holiday sales will play a big role and should give the stock the much-needed energy to surge once more.
There has been concerns that institutional investors may start reducing their exposure on Apple Inc. (NASDAQ:AAPL) as the stock is currently trading at some of the highest levels in the recent years. The impact of such move would result in the stock sliding even further in the market
“The holiday selling season obviously is a huge quarter for Apple Inc. (NASDAQ:AAPL) as people start to think of how the holiday starts to play out. The second catalyst is one that is a little bit settled which is investors have been tracking the inventory of the iPhone. If that inventory levels remain tight throughout the quarter, I think there is going to be greater expectations about a guide up in March,” said Mr. Munster.
Munster remains confident that the sustainability of the current refresh cycle among consumers on the iPhones will play a big role heading into 2015 as sales are expected to continue awaiting the release of iWatch. The fact that Apple Inc. (NASDAQ:AAPL) has not yet tapped into the full market potential in terms of iPhone sales could provide some of the needed energy that should see the stock to surging even further in 2015.
Consensus about Apple Inc. (NASDAQ:AAPL)’s value continues to increase steadily attributed to the fact that there is a belief that iPhone 6’s demand is still high in the market. The main concern at the moment is whether the gold rush like movement in the recent past will come back to hurt the stock in the long run. There has also been debate as to whether the company is registering impressive margins with the increased sales.
“I think the margins are going to inch their way up, there is little bit of a FX headwind but they still get the benefit of the yield improvement and they get the benefit of increased iPhone sales and their high margins,” said Mr. Munster.
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