Overview
- Citi analyst Asiya Merchant raised her 12‑month price target on Apple to $365 from $315 on July 13, keeping a buy rating and implying roughly 16% upside from mid‑July prices.
- Merchant said the upgrade rests on stronger‑than‑expected iPhone demand, faster growth in high‑margin services, progress on Apple’s AI work, and the company’s ability to raise prices without losing customers.
- Apple’s June guidance for June‑quarter gross margins of 47.5% to 48.5% is cited by analysts as evidence the company can sustain pricing power despite rising memory costs.
- Key risks that could undo the bullish case include Apple’s premium valuation near 38 times trailing earnings, volatile component markets that could squeeze margins, and a new lawsuit Apple filed against OpenAI over alleged trade‑secret theft.
- The near‑term test for Citi’s stance is Apple’s July 30 earnings report and the September iPhone 18 launch, which together should show whether demand, margins, and the AI story translate into sustained revenue growth.