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Will Pent-Up iPhone Demand Supercharge Apple Stock?

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Consumer electronics behemoth Apple (AAPL) received a price target increase from JPMorgan on Monday, based on what it believes will be high pent-up demand when the iPhone 8 is introduced later this year.

The iPhone 8 is expected to be a major product revamp and debut in September. It's rumored to feature a borderless 5.8-inch OLED display, glass-sandwich design, augmented reality capability, wireless charging and no physical home button.

JPMorgan analyst Rod Hall raised his price target on Apple to 165 from 142 and reiterated a rating of overweight. He raised estimates on Apple iPhone shipments for the company's 2018 fiscal year, to 260 million units, up from 245 million. That's up 18% year over year. Apple's fiscal year ends in September. Apple was also added to JPMorgan's "Focus List."

Apple stock finished 0.2% higher at 140.88 in the stock market today. Apple stock hit a record high of 142.80 on March 21.

Hall's estimates reflect not only higher unit volumes but a materially higher average selling price for the iPhone 8, assuming the new OLED-based iPhone Pro will price at an average of $1,000.


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"Even though an iPhone 'Supercycle' has been much discussed, we believe that Street numbers still fail to capture the size of the likely replacement cycle assuming Apple delivers a compelling product this year," Hall wrote.

In a flurry of product announcements last week, Apple debuted a red iPhone 7, an upgraded, lower-cost iPad and an app for making short videos called Clips.

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