Home / Finance / Apple’s ‘big story’ this holiday season is its credit card: Analyst

Apple’s ‘big story’ this holiday season is its credit card: Analyst

The “big story” for Apple this holiday shopping season won’t be what products consumers buy but how they pay for it, according to D.A. Davidson & Co. analyst Tom Forte.

“AirPods Pro [is] a good product, but I think the story for Apple’s holiday sales this year is in payments with the Apple Card,” he said Friday on “Closing Bell.”

With the iPhone market reaching a mature state, Apple has turned its focus toward expanding the number of services it offers to drive growth. That includes, as Forte pointed out, its foray into the financial services world with the launch of its Goldman Sachs-backed credit card earlier this year and the streaming wars with Apple TV+, along with its plans to dive deeper into health care services.

Although Apple’s overall business is “less dependent” on selling iPhones, he said, Apple’s credit card will serve as a feeder to its hardware products ecosystem. Apple Card will allow users to purchase iPhones free of interest for 24 months.

On top of that, the credit card offers 3% cash back on purchases.

“Everything they’re doing on the payments financial services side, also health care and then their proprietary video content, these are all important initiatives for Apple,” Forte said.

Apple tends to bring in more revenue during its holiday quarter compared with the other three quarters of its fiscal year. Wall Street estimates it will do nearly $6.6 billion in sales in the current quarter ending January, up slightly from the same period a year ago but more than 3% less than Apple reported for the 2017 fourth fiscal quarter, according to FactSet.

Apple shares slipped 0.22% to $267.25 per share in Friday’s shortened trading day. Forte has a buy rating on the stock with a $300 price target. Shares are up almost 70% thus far in 2019.

“It’s had an amazing year, but I think there’s still some more upside in the stock,” he said.


Source link

About admin

World Media News delivers breaking news, headlines and top stories from business, politics, entertainment and more in the US and worldwide

Check Also

Edna Smith Primus, Lawyer in Pivotal Rights Case, Dies at 75

Edna Smith Primus had graduated from the University of South Carolina School of Law — the …

Leave a Reply

Translate »