Apple Stock’s Rally Could Keep Going Thanks to ‘Stellar’ iPhone 13 Demand

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Demand for the iPhone 13 is on track to outpace previous iPhone models, according to analysts, with the potential to continue fueling

Apple
’s
growth even amid a wider tech selloff.

“We believe Apple (ticker:

AAPL

) is seeing stellar iPhone 13 demand globally on this elongated product cycle which is the drumroll to iPhone 14 this Fall,” wrote Wedbush analyst Daniel Ives in a research note.

iPhone 13 sales have been particularly strong in China, where Ives estimated Apple has gained roughly 3% of market share over the last 12 months.

Demand has also remained strong in the U.S., with a recent survey from Wave7 Research indicating that iPhone 13 sales were on pace to eclipse the iPhone 12 cycle, even as momentum slowed down with the launch of the Galaxy S22 model and supply chain snafus persisted.

“These incremental datapoints support our positive outlook for iPhone 13 demand into CY22,” wrote J.P. Morgan analyst Samik Chatterjee. The analyst maintained an Overweight rating on the stock and a $210 price target, saying iPhone 13 demand was one of several positive catalysts for the stock.

Apple could also reap the benefits of slowing demand for older iPhone models, especially with the recent launch of the more affordable 5G model, the iPhone SE, Chatterjee added.

Ives estimated that Apple could sell about 30 million iPhone SE units “out of the gates,” adding to the “strongest product cycle for Cook & Co. since 2015.” He reiterated an Outperform rating and $200 price target for the shares.

Shares of Apple rose 2% to $172.17 on Wednesday. The stock has lost 3% this year, but has gained 43% over the last 12 months.

Ives believes Apple could be poised to continue its rally now that the Federal Reserve has defined its interest rate increases and Wall Street starts buying up the tech sector again. He added that while supply-chain constraints had curtailed some growth over the last few cycles, investors were underestimating the pent-up demand.

“We believe the company is setting up for a monster growth cycle over the next 12 to 18 [months] that is not baked into shares at current levels,” he wrote.

Write to Sabrina Escobar at [email protected]