Why KeyBanc's Hargreaves Upgraded Apple to Overweight

KeyBank analyst Andy Hargreaves discusses Apple's stock upgrade due to its pricing strategy, which is expected to increase profits despite potential unit sales concerns. The iPhone's pricing elasticity and market segmentation are highlighted as strengths. Potential risks include Qualcomm's legal actions and supply chain issues, though these are seen as manageable. Beyond the iPhone, Apple's growth is driven by services like the App Store and the Apple Watch.

What was the main reason for Andy Hargreaves' upgrade of Apple stock?

• Increased unit sales

• Higher gross profit per user

• Improved supply chain

• New product launches

How has Apple's pricing strategy differed from most consumer electronics markets?

• Prices have decreased over time

• Prices have increased steadily

• Prices have fluctuated unpredictably

• Prices have remained stable

What is considered a 'tail risk' for Apple according to the analyst?

• Qualcomm's legal actions

• Decreasing demand for iPhones

• Supply chain issues

• Rising production costs

What is the primary driver of Apple's gross profits?

• Apple Music

• The iPhone

• The Apple Watch

• The App Store

Which segment of Apple's business is highlighted as having significant growth potential?

• The App Store

• Apple Pay

• Apple TV

• iCloud