Goldman Sachs Covers AAPL with $430 Target

| Apple Stock Watch

Goldman SachsGoldman Sachs initiated coverage of Apple Sunday with a “Buy” rating and a price target of US$430 per share. Former Credit Suisse analyst Bill Shope took up the hardware mantle at Goldman Sachs earlier this year, but just formally began his coverage of Apple at his new company, telling clients not to be concerned about eroding profit margins at the company.

According to Fortune, Mr. Shope told clients “We believe Apple’s margins have already bottomed, and we expect the company to resume its leverage-driven upside in coming quarters.”

In the way of background, he also wrote that, “Apple’s platform-centric business model is the secret sauce that has enabled it to quickly capture market share in new computing segments while simultaneously enjoying considerable margin leverage.”

He added, “Furthermore, we believe significant growth and profit opportunities for this platform still lie ahead. As a result, we expect revenue and earnings expectations to continue to trend upward, and we view the shares as attractive at current levels.”

In addition to his Buy rating and a price target currently at the high end of all the major brokerage firms, Mr. Shope also added AAPL to Goldman Sachs’s “American’s Conviction” list of stocks (according to Marketwatch). The firm’s previous hardware analyst, David Bailey, put AAPL on the same list in May of 2008.

 

*In the interest of full disclosure, the author holds a small share in AAPL stock that was not an influence in the creation of this article.  

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1 Comments

jfbiii

It certainly doesn’t hurt that 2.5 people chose the iPhone over Android in the U.S. in the third quarter. That’s subject to change, of course, but the wide availability of the iPhone 4 kicked Android growth in the ass over the same period.

Verizon strikes out.

As far as Apple goes, the 2.5 margin doesn’t even really matter: they make their 30% margin regardless of the overall numbers. But when you can’t offer a cut-rate product AND make gains on market share…well.

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