.July 15, 2024 09:28:00 AM

Apple (NASDAQ:AAPL) shares surged 2% in pre-market trading following an upgrade by Morgan Stanley analysts to a Top Pick, with a new price target of $273. The upgrade is based on the potential impact of Apple Intelligence and its limited backward compatibility, expected to drive a multi-year refresh cycle for Apple devices. Analysts predict Apple could ship nearly 500 million iPhones over the next two years, generating $485 billion in revenue and $8.70 in earnings by fiscal 2026.

Morgan Stanley analysts believe three key catalysts will support Apple’s stock performance: the upcoming Q3 earnings report, the mid-September iPhone launch, and potential positive iPhone build revisions in mid-October. Historical trends suggest that accelerating unit growth typically leads to Apple stock outperforming the market.