Analyst: AAPL to Hit $300

by , 12:45 PM EST, December 27th, 2007

Yared Investment Research CIO Georges Yared thinks that Apple's stock climb has plenty of momentum left in it, and that investors can expect that to continue for some time to come. He is so confident that AAPL will maintain its growth path that he raised his target price to US$300.

"I have raised my price target five or six times this past year," he said on BloggingStocks. "I think I started out at $85, went to $125, then $150, and so on. I'll make it easy -- for year end 2008, the new price target is $300."

He added that Apple is actually in a stronger position at its $200 price point than it was at $100. "Apple is experiencing massive momentum in all business segments and it's still early in all its product cycles," he said.

Even though Mr. Yared expects Apple will have sold over 120 million units by the end of the quarter on December 31, there is still plenty of room for growth. Only about 8 percent of the MP3 player market has been penetrated so far, which means there are still plenty of potential new iPod owners to attract.

The iPhone is still at the beginning of its life cycle, and Mr. Yared expects Apple will have sold over 20 million units by the end of 2008.

"iPhone is a revolution, not just a product," he added. "On June 28, 2007, Apple was not in the cell phone industry. On June 29, 2007, Apple became a feared major player."

The Mac and Mac OS X 10.5 are positioned to be strong sellers, too. The company is taking market share with its computers, and appears to be well positioned to continue that trend through 2008.

Apple has also managed to maintain strong operating margins at about 17 percent. According to Mr. Yared, that will likely turn in to 18 to 20 percent -- at a time when PC maker Dell can't even manage 6 percent.

Mr. Yared expects Apple will report $9.3 billion in revenue for this December quarter with an EPS of about $1.50. The end of the Fiscal year in September will likely yield $31 billion in revenue with $5.25 EPS, and fiscal 2009 will end with $38.5 billion in revenue and a $6.35 EPS.

Apple's stock is currently trading at $200.9101, up 1.9601 (0.99%).

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