Apple’s stock surged 7% on Tuesday, reaching a record-high close for the first time in 2024. This jump followed the announcement of its AI platform, Apple Intelligence, at the Worldwide Developers Conference (WWDC).
The stock had initially dipped on Monday during and after the conference but rebounded strongly, marking its best single-day performance since November 2022.
D.A. Davidson managing director Gil Luria upgraded Apple to Buy from Neutral and raised his price target to $230 from $200, emphasizing the unprecedented capabilities that Apple is introducing with AI integration.
“If you look at the signal away from the noise, you realize that this is an unprecedented capability that Apple is going to introduce and it’s going to integrate AI into everyday life,” D.A. Davidson managing director Gil Luria told Yahoo Finance.
For an in-depth look at Apple’s latest AI advancements driving their stock surge, read our article on Apple’s AI innovations. This piece covers the innovative technologies powering the new AI-powered iPhone.
Apple’s AI-powered iPhone has driven a significant stock surge, yet the company steers clear of the term “artificial intelligence.” Discover the reasons behind this in why Apple won’t use the term “Artificial Intelligence”.
Apple Intelligence will be integrated across the company’s hardware and software products, including iPhones, Macs, iPads, and more. The AI features will roll out in the fall for devices such as the iPhone 15 Pro and newer models, as well as Macs running Apple’s M1 series chips and later.
Here’s what people around the world have to say about it!
AI make number go up
— Mbongeni Ndlovu (@Mbounge_) June 11, 2024
Key features of Apple Intelligence include updates to Siri, which will now allow users to parse messages for addresses and find photos based on voice prompts. Additionally, Apple launched new software updates for its iPhones, Apple Watches, and Mac computers.
AI is a magic word now.
— AshutoshShrivastava (@ai_for_success) June 11, 2024
JPMorgan senior analyst Samik Chatterjee noted that the hardware upgrade cycle is driven by a collection of feature upgrades across diverse applications, predicting that the release of AI features will support an upgrade cycle across all Apple devices.
He added, “The release of the AI features across Mac, iPads, and iPhones will support an upgrade cycle across all the devices.”
The announcements follow a month of speculation and rumors, including a partnership with ChatGPT operator OpenAI. This excitement has contributed to Apple’s stock performance, which has increased more than 15% in the past two months.
“The stock’s been flat because there hasn’t been revenue growth at Apple,” Luria said. “Now, we think that this will allow Apple’s overall growth to accelerate from the low single digits into the mid-, maybe even high-single digits over the next year or two. That’s what can drive Apple’s stock.”
After briefly being surpassed by Nvidia, Apple has reclaimed its position as the second-most-valuable company in the world, behind Microsoft, with a market capitalization exceeding $3.1 trillion.
“As people buy new phones this holiday season, they’re going to see this great functionality,” Luria said. “They’re going to show their friends and family and the product upgrade cycle will happen over the next few months and quarters.”
Luria and Chatterjee believe that the new AI features will drive the next iPhone upgrade cycle, particularly for the iPhone 15 Pro and later models. This anticipated upgrade cycle is expected to act as a key catalyst for Apple’s stock.
Well, they’re will sure be more sales of iPhones!
— Arman Liaghat (@ArmanSpeaks) June 11, 2024
Luria pointed out that the stock had been flat due to a lack of revenue growth, but the introduction of AI features could accelerate Apple’s overall growth from low single digits to mid- or high-single digits over the next year or two.
I’m bullish myself — they have a super strong moat
They own EVERY single consumer tech possible
And the AI just solidifies their lead over everything
— Shray Bansal (@shraybans) June 11, 2024
The recent AI announcements by Apple are expected to significantly impact the company’s future performance, enhancing user experience and driving device upgrades. This strategic move positions Apple to catch up with and potentially surpass competitors in the AI market.
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