Apple is about to hit $3 trillion, but the analysts are already enthusiastic

Apple is about to hit $3 trillion, but the analysts are already enthusiastic

Apple's AAPL market cap is closing in on $3 trillion. If and when it hits the mark, which will require shares to reach $182.86, Apple will be in historic territory. The analysts are loving it.

This month alone, Katy Huberty of Morgan Stanley, Samik Chatterjee of JPMorgan and Amit Daryanani of Evercore ISI have raised their price targets on the stock to $200. Several factors are spurring analysts to fawn over Apple: Optimism for Apple's iPhone, its coming products including its rumored AR VR headset, and the company's ability to suck in consumers and keep them there through its services business.

Mohan wrote in a recent analyst note that Apple is expected to introduce an AR VR headset by the end of 2022 or early 2023. We consider this technology to be a game-changer as it will enable many new applications that require high performance hardware and higher access speeds. According to Mark Gurman, Apple's AR VR headset could cost upwards of $3000 and be geared toward gaming, entertainment and communications. Apple has been making various patents related to the technology, and it's been rumored for a long time.

TECHnalysis Research President Bob O Donnell told Yahoo Finance Live that if they move to the glasses, the AR and VR glasses that a lot of people expect to see in '22, that's another opportunity to build on this incredible ecosystem of device owners and iOS and Mac OS holders that really love their devices.

One of the major sticking points that the company has going for is the Apple s Services business, which includes its App Store. If you own an iPhone, you're going to buy apps, and when it's time to get a new phone, you'll probably buy another iPhone to keep those apps.

The same idea would apply to the company s AR VR headset if Apple can wrangle the kind of third-party developer support it already enjoys on the iPhone.

As use cases continue to develop beyond gaming and remote servicing and evolve into a whole new way in which the world digitally interacts, AR VR experts we have spoken with view as the long-term killer AR VR application, Huberty wrote in a Dec. 7 analyst note.

Apple's iPhone is still the major driver of Apple's revenue. Despite the supply chain problems that have upended nearly every industry around the world, Apple seems to be coming out of the crunch.

Our checks indicate that iPhone production is surprising to the upside as Apple hasn't had the same manufacturing disruptions as in the September quarter, Huberty wrote. While upward trending COVID cases could create new production bottlenecks, we view supply upside as a driver of better December quarter iPhone results. It's clear from what analysts believe is the truth that Apple's new headset and related apps and services business, not to mention the iPhone, will serve as the catalyst that will push Apple over the $3 trillion mark and send the company's stock even higher.

Santosh Rao, Manhattan Venture Partners head of research, told Yahoo Finance Live that Apple's rise is testament to its strong business model. It's an amazing story. The services business is very strong, he said, because we have the cars coming up the road, the 5 G refresh, and so many other things. This is a company that is well situated, as a whole. Apple needs to prove the analysts' optimism is correct.

One is not close to hitting $3 T and now it has to prove investors made the right call.

Email Daniel Howley at over encrypted mail at danielphowley, and follow him on Twitter at DanielHowley.