Morgan Stanley Lifts Apple Inc. (AAPL) Price Target on Earnings Growth Expectations

Apple Inc. (NASDAQ:AAPL) is one of the best forever stocks to buy according to hedge funds. On December 17, Morgan Stanley reiterated its Overweight rating on Apple Inc. (NASDAQ: AAPL) and increased the price target to $315 from $305.

Morgan Stanley Lifts Apple Inc. (AAPL) Price Target on Earnings Growth Expectations

The investment bank hiked the price target to reflect a 32X expected fiscal 2027 earnings per share estimate of $9.83, up from the previous forecast of $9.55. Nevertheless, Morgan Stanley expects the company’s gross margins to take a hit from higher input costs for memory. On the other hand, a 5% higher revenue forecast is expected to offset any significant margin decline.

Apple’s iPhone shipments are expected to increase slightly owing to a 0.1-year elongation of the year-over-year replacement cycle. The iPhone maker is already plotting a substantial expansion of its iPhone lineup and plans to offer as many as seven models by the fall of 2027. The expansion will come at the back of significant design changes, including the introduction of a foldable iPhone scheduled for the fall of 2026

On the services front, Apple has struck a deal with General Motors to integrate Apple Music into Chevrolet and Cadillac models.

“We are bringing the Apple Music app to GM vehicles in a way that takes full advantage of our industry-leading audio capabilities,” GM VP of global product management Tim Twerdahl added of the Apple Music union. “It’s the latest example of how we’re expanding entertainment choices built directly into our vehicles,” concluded Twerdahl, who previously served as Apple’s home and audio VP.

Apple Inc. (NASDAQ:AAPL) designs, manufactures, and sells consumer electronics (iPhone, Mac, iPad, Apple Watch), software (iOS, macOS), and online services (App Store, Apple Music, iCloud, Apple Pay).

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Disclosure: None. This article is originally published at Insider Monkey.