Apple Inc. shares closed at a record high Friday in a sign of optimism for the smartphone industry’s ability to withstand the COVID-19 crisis.
Apple AAPL, +2.84% shares added 2.9% in the session to close the day at $331.50. This marked the first record closing high since Feb. 12, when shares finished at $327.20, and the 11th overall record close this year, according to FactSet data.
Apple has come under pressure in recent months as the pandemic forced store closures and ushered in a period of weaker consumer confidence, but some analysts seem upbeat about the company’s trajectory now that stores are reopening and consumer spending continues to rebound.
“With roughly 350 million …iPhones in the pent up ‘window of an upgrade opportunity,’ we believe [Apple] has a unique opportunity to capture this delayed supercycle opportunity with a major 5G cycle on the horizon which will include a host of new smartphone versions/models for iPhone 12,” Wedbush analyst Daniel Ives wrote late Thursday while increasing his price target to $375 from $350 and maintaining an outperform rating.
Ives said in his note to clients that about 20% of iPhone upgrades could come from China in the year ahead. He argued that tensions between the U.S. and China represent “more headline risk” than something that could “truly” impact supply and demand for the forthcoming iPhones.
Apple’s Friday rally came even as Broadcom Inc. AVGO, +2.65% appeared to confirm a slight delay in the launch schedule for the new iPhone, according to analysts. Broadcom Chief Executive Hock Tan said on his company’s earnings call that Broadcom would “normally expect to see a double-digit sequential uplift in revenue from the ramp of next-generation phone at our large North American mobile phone customer” in the July quarter, but now the company expects that revenue uptick will occur a quarter later.
“This is not entirely surprising to us, as our model assumed the 5G iPhone would be delayed by roughly a month due to supply chain disruption and certain yield issues on 5G components,” Barclays analyst Tim Long said in a note to clients.
Investors will hear more from Apple shortly as the company begins its WWDC developer event on June 22. The company is holding the event virtually this year due to the pandemic, and Ives said that WWDC is unlikely to bring any “major surprises” but could offer some “breadcrumbs” regarding plans for AirPods, virtual reality and wearables.
Apple shares have added 11% over the past month as the Dow Jones Industrial Average DJIA, +3.15%, which counts Apple as a component, has gained 14%.