Where Will Apple Stock Be in 1 Year?

Apple (AAPL) has had a good 2022 so far. The technology and communications giant posted record first-quarter revenues and also unveiled a new iPhone—the iPhone SE, which is more affordable than the brand’s regular new model offerings.

Why then has its stock price sagged?

AAPL is currently struggling to maintain value around 12% lower than it was this time last year—hovering at around the $165 mark.

With a staggering market cap just under $3 trillion, roughly equal to the GDP of India, Apple is the largest company in the world.

Indeed, if it were a country, it would be the fifth-largest global economy, behind only the US, China, Japan, and Germany. However, its massive size has offered it no more protection from market headwinds than other technology stocks.

With the Russian invasion of Ukraine (with no predictable cessation of hostilities) and new variant Covid-19 infection rates surging in parts of China, technology stocks have been subjected to considerable negative market sentiment in the past few months. Current events have caused global economic uncertainty, which shows no more signs of an end than the conflict in Ukraine.

Apple’s 10 Year Astonishing Track Record

The last half-decade has been kind to the technology titan—its rise from $35 to its current price (after factoring in stock splits) is a gain of about 356%.

Its trailing return also beats comparable industry figures. With a track record of 24.5% annually over the past decade, Apple investors have ridden a wave, the magnitude of which will not be repeated in the future. 

Though the stock has increased by nearly 28% over the past year—9.3% of that just in the past six months—the recent news cycles have the behemoth generally in the shallows with some oscillations back higher.

Supply Chain To Hurt Q3 & Q4 AAPL Earnings?

Even before the Russian aggression against Ukraine, the market showed a recent sense of ennui with growth and technology stocks, which contributed to weakening AAPL’s numbers.

Supply chain troubles are predicted for this year’s second—and likely third—quarter, further dulling Apple’s shine. Most recently, the Russian invasion of Ukraine had a knock-on effect, resulting in the double-digit losses.

The stock had already shown signs of faltering following China’s lockdown of Shenzen in the first weeks of March following a recent surge in Covid-19 infections. Apple’s supplier Foxconn halted operations in the pandemic-hit region following the government-mandated closures and quarantine.

Some sources indicate Foxconn, who by now likely has procedures in place to compensate for such events, is taking steps to alleviate the effect of the work-stoppage. Its production and shipping operations are diversified throughout China, enabling it to shift some functions to other facilities not currently affected by the government-imposed restrictions. Analysts overall predict a minimal effect on Foxconn’s overall operations.

1 Year Upside: Almost 20%?

Short-term analysis of the stock shows few fundamental catalysts to drive the share price to new highs.

Wall Street analysts are indicating guarded optimism around AAPL. Thirty-one analyst ratings show the stock as a buy as of this writing.

Consensus isn’t unanimity, and though two of those analysts rate AAPL a strong buy, six others had the stock pinned as a hold.

The general 1-year outlook is still positive, with analysts predicting a rise of just under 20% to a figure approaching $190 by year’s end.

Some particularly bullish analysts have even gone as far as to suggest a rise of over 32%, with a 12-month target of around $210.

Even the bears aren’t growling too loudly, with the pessimistic take on the stock indicating a drop of only about 3%, to a 12-month price target of around $155.

Record-breaking Sales

Santa came to Apple late last year, as well. At the end of their first fiscal quarter, Apple posted an all-time, record-breaking revenue of $123.9 billion.

That was an 11% year-over-year gain, and quarterly earnings per diluted share went to $2.10 as a result.

Analysts—and the company’s CEO Tim Cook—feel this is primarily due to the new iPhone SE model, innovative chiefly in its affordable price point. The enthusiasm didn’t stop there—Apple’s board of directors accorded a cash dividend of $0.22 per share.

There’s data to back that up. The iPhone was the biggest bread earner of Apple’s line-up of goods and services during the holiday quarter. It accounted for $71.6 billion, a rise of over 9% on the previous year’s earnings.

Bargain iPhone Spikes Demand

Apple first revealed the new iPhone SE in early March 2022, and the most remarkable thing about it is its price. At $429, it is a departure from the company’s usual new model pricing, and its affordability is rightly credited for Apple’s impressive earnings numbers.

Though the lower price point from Apple is doubtless the primary reason behind high sales, Apple touts the phone’s increased durability, more robust battery life, and 5G access as other factors.

The camera is also powered by the A15 Bionic chip, which first debuted in the iPhone 13. Through the chip, advanced photographic capabilities are accessible to the phone’s owners, including Smart HDR 4 and Apple’s proprietary Photographic Styles and Deep Fusion features.

Where Will Apple Stock Be In 1 Year?

Apple anticipates further year-over-year growth is well within reach during the current quarter.

According to some analysts, Apple does caution that it does not expect to sustain its recent gains, casting doubt on a repeat of the just-ended quarter’s 11% performance.

One reason could be the apparent subsidence of the pandemic in most of the world, which with its concomitant lockdowns and quarantines saw people spending more time at home than in recent memory, contributing to the demand for Apple’s products.

Now that conditions are easing in many places, fewer people are homebound, and demand could likely fall.

Crystal Ball

Another factor in the uphill battle Apple may now be facing is the steady state of supply chain issues. Analysts expect that Apple will continue to feel the pinch as logistical constraints, most painfully in the company’s iPad line of products. Though the squeeze is likely to continue, sources indicate it may not be as tight as it was in the holiday quarter.

Here’s where Apple’s size proves to be a benefit. The company can better handle supply chain disruptions than most other operators in the consumer electronics and mobile telephony segments. Though limitations in supply are likely to continue for the foreseeable future, Apple can flex its scale and make big promises to suppliers to convince them to prioritize the tech titan’s needs.

Where does that put Apple’s price in one year’s time? A median target of $192 is the current best guess, which would be an increase of nearly 20% from current trading prices. On the high end, estimates fall in the range of $211 to $215 for this time next year.

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.