Investor and venture capitalist Gene Munster had good news for Apple investors and anyone leaning bullish on the Cupertino tech giant.
“I think for 2021, the performance is going to come again from Apple. It may seem tone-deaf for a company to lead FAANG for three straight years, but I think that in fact will happen. I think this has a track to $200 [per share],” he told CNBC.
One year after the Loup Ventures managing partner correctly predicted that Apple would hit a $2 trillion market cap in 2020 and overtake its long-time competitor Microsoft, he is making a similar forecast.
“It’s a year out there but I’m fast-forwarding the conversation to the middle and back half of next year, and we’ll be talking about 2022 at that point. If the market can sustain these 35 multiples — you know, we’re not talking about an Amazon-like multiple here — I think that that path is there.”
In 2020, sales of the iPhone 11 outperformed projected expectations, and the company’s growth was strongly driven by sales of Apple watches and AirPods. However, he really believes the company’s growth will come from a synergy of a greater investment in the Apple ecosystem from brand loyalists and the eventual creation of a “360 bundle” that ties the user experience together across modalities.
In a research note obtained by AppleInsider, he wrote pointed out that “about 55% of the company’s revenue can be purchased as a subscription. By adding Mac, iPad, and Watch subscriptions, that number would approach 85%.”
He continued down that train of thought, highlighting the developing emerging technologies space, increase in remote work due to the coronavirus pandemic, and the corresponding spurt of sales in Apple’s hardware product line by 40% in Q2 and Q3 2020
“This is generally thought of as a play on iPhone, a 5G play. That’s good. That will impact the numbers in a positive way, but this acceleration of digital transformation, I think it’s powerful… People working from anywhere are going to be arming up in the next 12 to 24 months, buying more Macs, iPads, services.”