The world’s single most important stock and the largest U.S. issue in terms of market capitalization — tech giant Apple Inc. (NASDAQ:AAPL) — is continuing its post-earnings melt-up on Monday. In fact, AAPL stock is pushing to fresh record highs after eclipsing its early 2015 peak of $129.36 last week.
The catalyst for Apple stock was better-than-expected quarterly results featuring a return to growth for the critical iPhone after a few quarters of declining sales. Despite criticisms over the loss of the analog headphone jack and the continuance of the 3-year-old iPhone 6 form factor, the iPhone 7 has been a surprising hit.
The buzz is building big-time for the expected launch of the all-new iPhone 8 later this year. Reports have been circulating that the new handset will debut exciting new features such as a wireless charging station that might allow users to charge the device from 15 feet away.
So, where does AAPL stock go from here?
RBC Capital ÃÛÌÒ´«Ã½s analysts surveyed investors over the last few weeks and discovered a few interesting takeaways that suggest prices could continue to grind higher from here.
- Many investors were neutral to underweight Apple stock heading into earnings on expectations of a modest pullback. Now, they’re debating whether they should build larger positions or wait for a pullback, possibly in anticipation of an air pocket of iPhone 7 demand in the second quarter.
- Some hedge funds were using AAPL stock as a short play while holding longs in related component supplier stocks. Those trades are underperforming now, resulting in some short covering demand for shares.
- Given Apple’s large cash holdings, there could be a surprise announcement at some point related to capital return to shareholders that could potential push shares toward the $180-a-share level.
More modestly, Goldman Sachs upped its price target on AAPL stock to $150, which still is about 14% higher from here.
Apple will next report results on April 25 after the close. Analysts are looking for earnings of $2.11 per share on revenues of $54.1 billion.
Anthony Mirhaydari is founder of the and investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.
