Home Editor's Picks Evercore ISI sees AI edge computing as a boost for Apple stock

Evercore ISI sees AI edge computing as a boost for Apple stock


Evercore ISI sees AI edge computing as a boost for Apple stock By Investing.com

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EditorLina GuerreroStock Markets

Published Mar 11, 2024 05:22PM ET

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On Monday, Evercore ISI maintained a positive outlook on Apple Inc. (NASDAQ:AAPL), reiterating its Outperform rating and a price target of $220. The firm’s assessment is based on the potential of AI-enabled tools, particularly the benefits of running artificial intelligence on edge devices like the iPhone.

The advantages highlighted include lower latency, improved security, and cost-effective accessibility, which could drive a new demand cycle for Apple’s devices.

According to Evercore ISI, Apple’s strategy to integrate on-device inference for large language models (LLMs) is expected to significantly enhance the user experience across its product lineup, including iPhones, Macs, and iPads.

The firm believes that Apple’s vertical integration and control over its silicon positions the company to expand its iOS ecosystem and potentially trigger an accelerated hardware refresh cycle. This cycle could be spurred by major hardware updates, such as an enhanced neural engine or GPU.

The analyst suggests that a substantial upgrade in capabilities may also lead to an increase in average selling prices (ASPs). Despite recent market sell-offs, Evercore ISI views the current valuation of Apple’s stock as having strong support, with the potential to rise based on several factors. These include capital allocation strategies, the adoption of AI inferencing, and a shift to more defensive investment positions.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Evercore ISI sees AI edge computing as a boost for Apple stock

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