Since the Jan. 18 report where Apple said it sold a record 16 million iPhones last quarter and nearly doubled the sales of iPads, at least five firms have raised their 12-month forecast on the stock to an average price of $467, or a 32 percent increase from here. At that level, Apple’s market value would total $433.7 billion, flying past Exxon Mobil’s current market value of $423.2 billion.
After underestimating iPhone and iPad sales for the last year, analysts as a group have ratcheted their numbers up for Apple this year more than any other technology company, according to analysis by Bespoke Investment Group.
"iPhone sales are tracking above our last forecast, triggering an upward revision in our forecast of phone sales going forward," wrote Charles Wolf, an analyst for Needham, in a report yesterday that placed a $450 price target on the stock. "While the increase in iPhone sales in our new model was relatively modest, it nonetheless added $50 to our price target because of the profitability of the phone. The migration of feature phone users to smartphones accelerated in the second half of 2010, suggesting that even our new forecast could prove to be conservative."
The catalyst driving the most bullishness is the launch of the iPhone on the Verizon network this Thursday.
"Our monthly channel checks indicated continued strong sales of the iPhone4, as it remained by far the top-selling smartphone at AT&T," wrote Canaccord Genuity’s Michael Walkley, who raised his price target on Apple today to $460. "Further, our checks indicated Verizon is planning for strong demand for the CDMA iPhone4 launch."
Apple’s stock hit a new all-time high today of $355.12, valuing it at $326.6 billion. Three other analysts have raised their price targets on the stock since its earnings report. RBC raised it to $425 from $395 and increased estimates. Caris & Co. upped its forecast to $450 from $430 citing iPad sales. And the biggest bull, Ticonderoga Securities, slapped a $550 target on Apple, citing future sales in China.
"The Verizon iPhone is being underestimated in my opinion," said Josh Brown, money manager and author of the popular Reformed Broker blog. "Also, the tablet game is only in the 2nd inning. Reminds me of Dell Computer in 1996 – estimates wouldn’t catch up until a couple of years later."
It hasn’t all been up arrows for the stock this year. Apple shares plunged 6 percent on a day in early January after CEO Steve Jobs said he would take a medical leave of absence, leaving COO Tim Cook in charge. Also, bears cite the coming threat of tablets powered by Google’s-Android.
But bulls say Apple will remain the gold standard for tablets in consumers’ eyes, has only begun to crack the international market for its products and has a strong executive bench to continue expanding the ‘Halo’ created by Steve Jobs.
"Analysts are as giddy as you can be, but Apple just keeps surpassing those numbers," said Pete Najarian, co-founder of TradeMonster.com and a ‘Fast Money’ trader.
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John Melloy is the Executive Producer of Fast Money. Before joining CNBC, he was an editor for Bloomberg News, overseeing the U.S. Stock Market coverage team.