Apple seen riding higher on strong iPhone demand, iPad rebound

Tue Oct 21, 2014 8:07am EDT
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(Reuters) - Strong global demand for Apple Inc's (AAPL.O: Quote) iPhone 6 will drive revenue growth through 2015, while updated models should help reverse three straight quarters of declining iPad sales, analysts said.

Apple shares were set to open 2.4 percent higher on Tuesday.

The company posted better-than-expected revenue on Monday on the back of a record iPhone launch that saw 39 million of the smartphones sold in the September quarter.

"We expect this momentum to continue in the December quarter and into 2015, particularly as supply improves steadily in coming months," Goldman Sachs analysts wrote in a note to clients.

Goldman raised its price target on the stock by $9 to $124, above a mean price target of $112.02, based on 51 brokerages covered by Thomson Reuters StarMine data.

At least 10 other brokerages raised their price targets on the stock by between $1 and $20.

Orders for Apple's new iPhone 6, which comes in larger sizes and a heftier price tag, began in September.

"(We) were encouraged by Tim Cook's comments regarding Apple basically selling every iPhone 6/6 Plus it can produce and will likely remain undersupplied relative to demand through the end of 2014," Canaccord Genuity analysts said in a note to clients.

They said Apple was not expected to catch up with demand until early next year.   Continued...

A customer holds the newly released iPhone 6 at a mobile phone shop in Moscow, September 26, 2014. REUTERS/Maxim Shemetov