DespiteApple Inc’s distant fourth rank among FAANG peers in terms of first-half gains, Loup Ventures analyst Gene Munster is bullish the Cupertino-based company will emerge as the top performer through the rest of 2021.
What Happened: Munster, who leads the research-based venture capital firm, said he is sticking to his original theory that faster digital transformation will drive demand for iPad and Mac businesses, which already contribute about 25% of the total revenue.
“This is playing out as expected, with demand for these segments outpacing supply,” Munster said in a note.
“Apple is unlikely to reach demand supply equilibrium for Mac and iPad until the September quarter, which leads us to believe the best days are still ahead for Mac and iPad.”
The Apple analyst also said 5G adoption will grow in the back half of the year, leading to a 2-3 year iPhone upgrade cycle.
Why It Matters: Munster in April said Apple will bethe top FAANG stock in 2021 overall, a prediction he said now seems unlikely to come true.
Apple embraced the 5G networks in October last year with the launch of iPhone 12, 12 mini, 12 Pro, and 12 Pro Max, the first iPhones to support 5G connectivity.
After a roaring start, Apple’s5G shipment volumes fell 23%in the first quarter sequentially, following a blowout fourth quarter when the new 5G iPhone was wildly popular as a gift during the holiday season.
Standing Among FAANGs: Alphabet Inc sits on the top of the FAANG chart so far this year, fetching 52% returns, as of July 15.
Facebook Inc andAmazon.com Inc are next, registering 28% and 16% year-to-date gains, respectively. Apple stock has grown 15%, whileNetflix Inc , at the bottom of the chart, has grown 6% during the period.
Price Action:Apple shares closed 1.41% lower at $146.39 on Friday.