Apple Shares Surge Following AI Strategy Announcement
- Apple's recent advancements in artificial intelligence, highlighted by the launch of Apple Intelligence, have led analysts to raise their sales projections for the company's devices.
- These optimistic forecasts have significantly contributed to Apple's stock reaching a record high.
- The surge reflects strong investor confidence in Apple's future growth driven by its technological innovations.
Apple Inc. saw its shares soar to a record high during Monday's trading session, reaching $236.30, following Morgan Stanley's designation of the stock as a "top pick." This surge is attributed to Apple's recent push into artificial intelligence (AI) with the launch of Apple Intelligence, aimed at encouraging customers to upgrade their devices. The initiative comes as Apple seeks to catch up with competitors like Alphabet's Google and Microsoft-backed OpenAI in the rapidly evolving AI landscape. Despite a slight pullback, Apple shares remained up over 1.9% in early afternoon trading, maintaining a market value of $3.62 trillion, the highest globally. Morgan Stanley analysts highlighted that Apple Intelligence could significantly boost shipments of iPhones and iPads, noting that the new technology is currently compatible with only 8% of existing devices. With 1.3 billion smartphones in use, analysts project that Apple could sell nearly 500 million iPhones over the next two years, prompting an increase in their price target for the stock from $216 to $273. Year-to-date, Apple stock has risen more than 26%, outperforming the S&P 500 index, with an average rating of "buy" and a median price target of $217. The company sold 45.2 million smartphones globally in the three months ending in June, a slight increase from the previous year, although its market share dipped to 15.8%. Analysts anticipate that both Apple and Samsung will lead a recovery in the global smartphone market, driven by interest in generative AI-enabled devices.