JPMorgan Raises Apple Price Target to $315

JPMorgan analyst Samik Chatterjee raised the price target on Apple (NASDAQ: AAPL) to $315.00 (from $305.00) while maintaining an Overweight rating.

“Apple shares have underperformed the broader S&P 500 Index over last two months (-13% vs. +1%), as we believe that positive data points in relation to robust iPhone 17 demand have been overshadowed by investor concerns in relation to gross margin impact from the unprecedented rise in memory costs, potential price elasticity concerns for iPhone demand, as well as modest concerns from softer intra-quarter data points in relation to App Store Services growth.

However, we see a positive set up for the shares heading into F1Q26 (Dec-end) earnings print as AAPL shares are trading at 30x NTM P/E, below the peak multiple that is typical for the shares heading into a key iPhone product cycle (previous peak of ~32x into 5G cycle), in combination with the modest upsides in relation to both F1Q26 print and the F2Q26 outlook.

The upsides expected in the F1Q26 print and F2Q26 outlook, while modest, are likely to emphasize to investors the reliable execution from the company in a tough macro even as investors await the tailwinds from a more robust product cycle in relation to iPhone 18 series.

Tuning to the upsides expected in the quarter as well as the concerns: Firstly, we expect iPhone revenues to track ahead of consensus expectations and the forecasted 16% iPhone revenue growth to put the company on track to deliver it highest ever iPhone revenue growth since Sep-21, as per our estimates.

Secondly, in relation to Services, App Store revenues are expected to track ~7% y/y growth in F1Q26 (see report here), softer than the total Services growth guide of ~14% y/y, however, we believe that Apple has multiple levers (from other Services) to deliver robust Services growth beyond App Store, similar to what the company did in F4Q25 when the company delivered to +15% y/y growth while App Store was estimated to contribute only 10% growth (see report here).

Thirdly, we expect limited margin pressures from higher memory costs as Apple has long-term supply and pricing related contracts with suppliers and its scale helps to drive materially favorable component cost outcomes relative to IT Hardware peers.

Additionally, volume and revenue upsides support stronger volume leverage upsides for gross margins relative to expectations.

Fourth, while timing driven, we expect opex for F1Q26 to track lower than the guide, since the likely key driver of inflection in opex – the fee for access to foundational Gemini models, is not expected to ramp in F1Q26 but rather in F2Q26.

The above four drivers lead us to forecast a modest revenue and a robust EPS beat in F1Q, followed by an F2Q outlook for 10%-12% revenue growth mirroring the guide issued for F1Q.

We are increasing our Dec-26 price target to $315 (vs. $305 prior) driven by higher earnings power as well as a higher target multiple more in line with the peak multiple for the shares heading into a key product cycle later this year.”

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