Apple's Big Week - Here's What You Need To Know

This is a big week for Planet Apple. From June 4-8, Apple Inc. (NASDAQ:AAPL) hosts its 2018 Worldwide Developers Conference (WWDC) with a keynote address on June 4 at 1pm ET. As Steve Jobs described the Apple ecosystem at his last WWDC in 2011, “If the hardware is the brain and sinew of our products, the software in them is their soul.” However, Apple also uses the event as an opportunity to announce new hardware innovations (see the scene-stealing HomePod last year).

So what’s on the card for this year’s event? Ahead of the conference, five-star Monness analyst Brian White shares his take on what we can expect over the next few days. “Even with the recent stock rebound, we continue to view Apple as one of the most underappreciated stocks in the world” states White.

He reiterated his buy rating on AAPL with a $235 price target on June 1. This indicates big upside potential for Apple of 24%. As we can see from his TipRanks profile, so far his AAPL ratings have proved fairly accurate with a 76% success rate and impressive 23% average return.

Let’s take a closer look at his 3 key WWDC predictions now:

1. Welcome to iOS12

This software is fundamental to the Apple smartphone experience. The iOS 12 operating system will be the backbone of Apple’s new phones and software updates. According to a Bloomberg report, Apple will introduce a new (and perhaps surprising) initiative called Digital Health. This helps users spend less time on their phones, curbing smartphone addiction and better enabling parents to monitor children’s phone.

“Given the importance of the iPhone to the Apple product family, new iOS innovations tend to get a fair amount of airtime at WWDC and we expect this will be true with iOS 12 next week” states White. He adds “In light of the Cambridge Analytica fiasco, we wouldn’t be surprised if Tim Cook spends a couple of minutes reinforcing Apple’s commitment to protect customer privacy.”

2. A whole new reality

Are you ready? White expects artificial intelligence to be a big theme at WWDC this year. Potential new features include integrating live face-based Emojis (known as Animojis) into FaceTime, and games that friends can play against each other in the same augmented reality world. Following Google’s lead, Apple is also likely to make this open to both Android and iPhone users.

“Given Apple’s growing support for AR [augmented reality] with the unveiling of ARKit at last year’s WWDC, we expect the company to expand its AR capabilities” says White. ARKit is a software development kit for developers to make augmented-reality apps. These apps augment reality by placing virtual objects in your physical world, typically by using your phone's camera.

Also bear in mind that Apple has just hired John Giannandrea as SVP of Artificial Intelligence. The company poached him from his role as AI and search chief at Google.

3 The HomePod resurfaces

HomePod was the star of the 2017 WWDC. And now we can expect some further developments for this smart speaker. White writes: “we expect the company to provide an update on its progress, discuss the new features supporting HomePod announced this week with iOS 11.4 and possibly provide more color on its future development.”

An iPad update isn’t guaranteed, although White is expecting some sort of refresh for the Mac portfolio, combined with an update to macOS. At last year’s WWDC, Apple introduced macOS High Sierra that added support for Virtual Reality (VR) content, and further VR commentary next week is highly likely.

3. What does the Street have to say?

White is on the bullish side of the Street when it comes to Apple stock. Based on the last three months of ratings, Apple has a cautiously optimistic ‘Moderate Buy’ consensus rating from the Street. This breaks down into 15 buy ratings and 13 hold ratings. Meanwhile the average analyst price target of $195 indicates only 2% upside potential from the current share price. You can click on the graph below for further insights into the latest market activity on AAPL:

June is a busy month...

 

Also keep an eye out for the upcoming E3 Expo in Los Angeles that begins June 12. Word on the Street is that video gaming giant Electronic Arts (NASDAQ:EA) is the stock to watch into the event. As we can see from TipRanks, EA boasts a ‘Strong Buy’ consensus rating with 10 recent buy ratings and only 1 hold rating. Plus note that shares are already up 29% year-to-date.